We are excited to announce that, together with our partners at ED&F Man Capital Markets Inc., itBit has completed the first “Exchange for Physical” (EFP) Bitcoin transaction on behalf of two institutional investor clients.
This is the first time an EFP transactionhas been reported to a U.S. futures exchange where the underlying “physical asset” was a digital currency. This transaction marks a milestone for mainstream markets’ adoption of digital currencies.
Since the launch of Bitcoin futures late last year, the market has consisted only of “cash settled” contracts, meaning participants trade contracts that track the price of Bitcoin, but the contracts eventually settled in cash. The EFP trade is the first instrument to link the “physical” spot-exchange market to the futures market, which will likely lead to additional products linking the two markets. The trade is an important step towards connecting traditional institutional financial services products to the crypto asset space and progresses the development of institutional capital markets infrastructure of crypto as an asset class.
You can read more about this “Wall Street first” on CCN.
Crypto asset trading involves a high degree of risk. The crypto asset market is new and unproven and may
not grow. Currently, there is relatively small use of crypto assets in the retail and commercial
marketplace in comparison to relatively large use by speculators, thus contributing to
price volatility that could adversely affect an investment in crypto assets. In order to
participate in the trading of crypto assets, you should be capable of evaluating the
merits and risks of the investment and be able to bear the economic risk of
losing your entire investment. No material at this site should be considered
as an offer by itBit to sell or solicitation by itBit of any offer to buy bitcoin or other crypto assets.