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Another crypto derivatives exchange wins CFTC nod to offer physically-settled bitcoin swaps

Celia Wan

The U.S. Commodity Futures Trading Commission (CFTC) has just given the green light to another Swap Execution Facility (SEF) operated by cryptocurrency startup Tassat, following SeedCX's and LedgerX's SEF registrations. 

Previously known as trueDigital, Tassat rebranded itself in September as it pivoted into the derivatives trading and institutional payments markets. With the CFTC approval, the firm is now planning to list physically-settled bitcoin margin swaps. Tassat hasn't disclosed the exact launch date, but it said it has been "actively onboarding institutional participants" and testing the product. 

The launch of bitcoin margin swaps will posit Tassat in direct competition with SeedCX, which started testing a swap product of a similar structure in August and told The Block at the time that it could launch "within the next three months." Meanwhile, LedgerX was granted the SEF registration in 2017 and it offers swaps and options products to institutional clients. 

Speaking on the potential competition, Tassat CEO Thomas Kim, told The Block: "Tassat has been working with market participants to design and develop our contracts for quite some time as a core tenet of how we will continue to release new financial products - in partnership with the very participants who intend to trade.  As a result, we have a set of execution workflows in the pipeline that we expect will drive adoption over our competitors."