Institutional involvement? London Clearing House partners with exchange GFO-X to provide Bitcoin futures and options clearing services

LCH SA (London Clearing House's French subsidiary) announced yesterday (13th) that it will provide clearing services for "cash-settled" Bitcoin futures and options contracts on the digital asset platform GFO-X. The company stated, "This clearing service will provide market participants with the option to clear crypto derivatives in a regulated environment," indicating that in the future, LCH SA may also provide similar services for other exchanges.

London Clearing House to Provide Bitcoin Derivatives Clearing Services

GFO-X is the UK's first compliant digital asset derivatives exchange, regulated by the FCA. In addition, GFO-X also collaborates with leading CCPs (providing clearing services for trading parties) globally.

LCH (London Clearing House) is one of Europe's largest multilateral clearing organizations, offering clearing and risk management services to exchanges, clearinghouses, investment firms, and corporations in Europe. The well-known CME also has CME Clearing under its umbrella to provide clearing services.

According to LCH SA's press release, GFO-X's new Bitcoin futures and options contracts will be cash-settled through LCH DigitalAssetClear.

LCH DigitalAssetClear will offer market participants "fully segregated" clearing services, including segregated margin. This benefits both exchanges and users by enabling the clearing of Bitcoin contracts in a new and compliant manner, with the service expected to go live in Q4 of this year.

London Clearing House Better Equipped to Handle Crypto Complexity

Frank Soussan, Head of LCH DigitalAssetClear, stated that there is a growing interest among institutional investors in trading Bitcoin futures and options contracts, but they prefer to do so in a regulated environment.

"(The clearing service provided by GFO-X) represents the combination of GFO-X's cutting-edge technology and service with LCH's risk management capabilities, creating immense potential. We look forward to collaborating with GFO-X and other market participants to establish a highly liquid, regulated crypto derivatives market, enabling the industry to grow steadily and securely."

Aranb Sen, Founder and CEO of GFO-X, added:

"Recent events (FTX bankruptcy) have highlighted the market's need for secure and regulated trading platforms where large financial institutions can conduct sizable transactions, and LCH's mature management capabilities are well-equipped to address the complex clearing requirements of crypto derivatives."