FalconX, CF Benchmarks Collaborate to Introduce CFTC-Regulated Crypto Derivatives

July 18, 2023 - Digital assets prime broker FalconX is partnering with CF Benchmarks, a cryptocurrency index provider, to launch crypto derivatives regulated by the Commodity Futures Trading Commission (CFTC). These derivatives will settle against indices overseen by CF Benchmarks.

The contracts—comprising swaps, options, and non-deliverable forwards (NDFs)—will settle against single asset reference rates provided by CF Benchmarks. Notably, these contracts will offer exposure to Bitcoin and Ether, settled against the CME CF Bitcoin Reference Rate and the CME CF Ether-Dollar Reference Rate, respectively.

"Derivatives benchmarked against resilient and regulated indices are the primary route institutions take to gain exposure to the crypto asset class," noted Sui Chung, CEO of CF Benchmarks, “We are delighted that FalconX will provide exposure to a host of digital assets through our market-leading benchmarks, including the CME CF BRR. This will encourage further activity in the fastest-growing area of institutional finance today."

CF Benchmarks has played a crucial role in the crypto market since 2017 by providing indices to settle regulated crypto derivatives contracts from the CME. FalconX clients, as part of this partnership, can utilize the liquidity complex surrounding the CME CF BRR, including CME crypto futures and ETFs listed across several jurisdictions.

These benchmarked derivatives contracts aim to cater to the increased demand for secure, transparent investment products in the expanding digital asset space. This collaboration allows institutional investors to gain exposure to cryptocurrencies, backed by a regulated infrastructure.

"Regulated derivatives are critical instruments for institutional investors to safely access digital assets," said Baris Cetinok, Chief Product Officer of FalconX. “We are proud to be able to deliver the industry's best in class regulated derivatives offering - purpose built for the world's leading institutional investors.”