GFO-X is the UK’s first regulated and centrally cleared trading venue dedicated to digital asset derivatives.

The trading venue stated that it has been working closely with these partners to deliver the requirements necessary to grow the institutional digital asset index futures and options market. 

Read more: LCH SA to launch UK’s first centrally cleared trading venue for digital asset derivatives with GFO-X

“We are delighted to announce our strategic partners as we drive towards launch in Q1 next year. Their support is a clear and strong endorsement of our vision of the market structure required to deliver digital asset derivatives to large institutional clients,” said Arnab Sen, chief executive and co-founder at GFO-X.

“It demonstrates the need for a highly regulated venue to bring additional depth, breadth, and diversification to the current limited choices in centrally cleared digital asset index derivatives. We believe the digital asset derivatives market will grow exponentially over the coming years.”

GFO-X offers a trading platform built for institutions, providing investors with a secure and efficient trading environment to manage digital asset exposure.  

“As a market maker, our strategic connection with GFO-X underscores our commitment to the institutional digital asset futures and options market – a rapidly evolving space we believe holds significant potential for continued growth and opportunity,” said Osi Lilian, IMC Strategic Investments co-lead.

The venue added that it looks forward to announcing additional partnerships with leading financial institutions in the immediate future.

Read more: M&G Investments leads $30 million Series B funding round for GFO-X

“We are excited to partner with GFO-X, the UKs first regulated and centrally cleared trading venue dedicated to digital asset derivatives,” said Barry Polak, lead product commerce at ABN ARO Clearing.

“This strategic collaboration underscores our shared commitment to advancing the institutional digital asset futures and options market.”

The post GFO-X names ABN AMRO Clearing, IMC, Standard Chartered Bank and Virtu Financial as strategic partners ahead of launch appeared first on The TRADE.

Across the market, participants are keen for a term rate anchored in €STR markets, said the firm.

The rates will be published in tenors of one, three, six, and 12 months and are based on CME Group’s liquid €STR futures and OTC swap market data. 

“We are introducing €STR term rates in response to client demand for a more robust and transparent term rate for the growing €STR ecosystem,” said Max Ruscher, head of benchmark services, CME Group. 

“Building on the increasing liquidity in our €STR futures market and OTC trade data, our term rate is based on comprehensive derivatives transactions data that will help clients build lending and fixed income products.” 

Read more: CME Group set to launch €STR options in Q1 2024

Since the launch in October 2022, more than 5 million €STR futures contracts have been, said the firm.

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CCS trades have notable settlement risk exposure linked to the high value of the initial and final principal exchanges. Settling these trades on a gross bilateral basis also results in operational inefficiencies and liquidity constraints.

The CCS service can be used in conjunction with post-trade processing platform MarkitWire to integrate CCS flows into CLSSettlement, providing the ability for participants to benefit from multilateral netting against all FX transactions.

As a result, this leads to an optimisation of liquidity, alongside a reduction in daily funding requirements.

“We look forward to leveraging CLS’s CCS service to optimise liquidity and mitigate settlement risk,” said Pierre-Jean Benazech, global head cross CCY swaps trading at Société Générale. 

“The unique PvP settlement system and netting capabilities mark a positive step forward in our efforts to optimise our foreign exchange operations.”

Read more: Barclays connects to CLS’s cross currency swaps service

The service has experienced exponential growth, with the values of CCS submitted to CLSSettlement up 87% year-on-year in Q3 2024.

CLS added that the growth in its service also supports the efforts of policy makers and regulators who promote broader adoption of payment-versus-payment (PvP) mechanisms to reduce FX settlement risk and systemic risk in the OTC derivatives market.

“We are delighted that Société Générale has gone live on our CCS service. Participation in the service underscores its effectiveness in enhancing operational and liquidity efficiencies for CCS trades,” stated Lisa Danino-Lewis, chief growth officer at CLS.

“The growing adoption of this service as well as the growing values submitted indicate that FX market participants are actively pursuing innovative solutions to further reduce settlement risk and improve operational efficiency.”

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The product will be available beginning 2 December and exclusively listed and traded on Cboe Options Exchange.

The options will be SEC-regulated and based on the new Cboe Bitcoin US ETF Index.

“Our new suite of options on the Cboe Bitcoin US ETF Index offers a timely and compelling solution for traders to efficiently gain exposure to spot Bitcoin,” said Rob Hocking, global head of product innovation at Cboe.

“We expect the unique benefits of cash-settlement, combined with the availability of various index sizes and FLEX options, will give customers more flexibility in their trading strategies. Our index options offer a unique value proposition that we believe will appeal to both institutional participants and retail traders alike, who are looking to capitalise on or hedge against Bitcoin’s price movements without directly holding the asset.”

Options on the Cboe Bitcoin US ETF Index means that users gain exposure to spot Bitcoin ETFs – and indirectly to Bitcoin itself.

As well as cash settlement, these index options will offer European-style exercise, exercisable only on the expiration date and eliminating the risks of early assignment.

Cboe also plans to offer Cboe Mini Bitcoin US ETF Index options, as well as cash-settled FLEX options on both the Cboe Bitcoin US ETF Index and the Cboe Mini Bitcoin US ETF Index.

Adam Inzirillo, global head of data and access solutions at Cboe, said: “This latest initiative showcases the strength of Cboe’s exchange ecosystem – from listing and trading spot Bitcoin ETFs on our US equities exchange, to generating data that drives index creation, and now launching innovative tradable products like Cboe Bitcoin US ETF Index Options.

“Our ability to leverage the full breadth of our platform to continually bring new solutions to market is a key differentiator for Cboe and a major benefit to our customers.”

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Walt Lukken, FIA

The NFA defines a FCM as an entity that solicits or accepts orders to buy or sell futures contracts, options on futures, retail off-exchange forex contracts or swaps, and accepts money or other assets from customers to support such orders.

In response to CME Group receiving approval, Walt Lukken, president and chief executive at FIA, labelled the development as an “example of a trend that raises serious concerns about market regulation and systemic risk”.

He added that the approval comes at a time when the CFTC has yet to propose a strong rule to address conflicts among affiliated CFTC-regulated entities.  

“Nearly three years ago, FTX sought CFTC approval for a vertically integrated business model. FIA warned the CFTC at that time that such a novel structure would raise concerns about conflicts of interest from combining multiple market functions under one roof. Three years later, these risks remain unaddressed.”

At the time, the collapse of FTX sparked concerns around the regulatory oversight of digital assets exchanges and their linked trading and custody subsidiaries.

Read more: Wild West in action: FTX’s fall from grace

“We strongly believe inherent conflicts of interest exist when one organisation controls multiple market functions – trading, clearing, intermediation and market regulation. FIA urges the CFTC to move forward immediately on a rulemaking to address this matter,” added Lukken.  

When contacted by The TRADE in response to FIA comments, CME Group stated that it has nothing else to add to its initial statement.

Terry Duffy, chairman and chief executive at CME Group, noted that the firm is pleased that the NFA has approved its FCM application, adding: “We remain committed to the FCM model and believe in the time-tested risk management benefits it continues to provide.

“At the same time, as our industry continues to evolve, our FCM will ensure CME Group is in a strong position to quickly adapt to our clients’ changing business needs.”

The post CME Group’s approval to establish futures commission merchant sparks backlash from FIA appeared first on The TRADE.

He joins the firm from Deutsche Bank where he served as a currency options trader.

Prior to this, Roberts spent five and a half years at NatWest Markets, most recently serving as a FX derivatives trader.

Elsewhere in his tenure at NatWest Markets, he worked as a US rates strategist.

Roberts announced his appointment in a social media post.

This latest appointment follows that of Olivia Gassner, who was appointed VP, equity electronic sales trader at JP Morgan earlier this month.

Gassner joined the firm from RBC Capital Markets, where she served in the same role for three years prior to the move. 

The post JP Morgan taps Deutsche Bank for new FX options trader appeared first on The TRADE.

Robert Allen, president of FMX Futures Exchange

Having opened on 23 September, the FMX Futures Exchange is the first US interest rate futures exchange to launch with a fully operational, globally connected trading system, allowing for potential capital savings driven by clearing partner LCH’s cross-margin capabilities.

BGC Group and ten global investment banks and market-making firms announced a partnership in April 2024 to create FMX Holdings which includes the exchange, as well as a spot foreign exchange platform, and a US cash treasuries platform.

“We are pleased ION connected to the FMX Futures Exchange. The combination of the FMX Futures Exchange with LCH will provide clients with choice, innovative execution technology, and potentially significant cross-margin capabilities,” said Robert Allen, president of FMX Futures Exchange.

ION supports FMX across its cleared derivatives front-, middle-, and back-office platforms, allowing banks and brokers using ION’s technology stack to offer clients advanced execution capabilities and clearing services on the new exchange from day one.

Read more: Fireside Friday with… ION’s Edoardo Pacenti

“The joint effort with FMX Futures Exchange demonstrates once again the effectiveness of ION’s front-to-back product strategy: the powerful combination of modern, integrated solutions across execution and clearing removes the technical barriers often hindering market readiness and participation,” said Francesco Margini, chief product officer for cleared derivatives at ION Markets.

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The active investment house with $33 billion offers a range of funds that invest in the UK, Europe, the US and around the world, and selected Northern Trust for a range of asset services earlier this year.

Speaking to The TRADE, Sheenagh Dougall, chief operating officer, Artemis, said: “What ultimately informed the decision was what this could do for our clients and how it could enhance their returns.

“Our centralised dealing desk has done a fantastic job for our business and for our clients, but I think we recognise some of the limitations of having a dealing desk in-house in a firm of Artemis’s size where we can’t do that follow the sun method. We are based in the UK, but we have funds that operate in the US and in emerging market space and, potentially, could we do better in those areas and have better coverage?”

Northern Trust will support all trading activity for Artemis’ equity funds under management and all related over-the-counter and exchange-traded derivatives. The appointment follows a review by Artemis of its operating model intended to help align its operational structure with its strategic growth plans.

Four members of Artemis’ dealing team will move to Northern Trust.

Mark Murray, senior partner at Artemis, said: “Outsourcing our equity and derivatives trading to Northern Trust ensures our continued access to global markets, whilst delivering high-quality liquidity and operational scale, further expanding the partnership and strong cultural fit between our organisations.

“We are confident this extension of service delivers the capabilities and operational resilience we require – supporting our focus on providing outstanding returns and service for our investors, as well as our ambitious plans for the continued growth of our business.”

Northern Trust is on an unprecedented run of securing outsourced trading mandates over the past 12 months, signing deals with True Potential, Waverton Investment Management, 2Xideas and Nedgroup. A major mandate was also secured with Rathbones in April 2023.

“We are excited to be partnering further with Artemis to support their end-to-end requirements for global equities and derivatives trading,” said Glenn Poulter, global head of brokerage at Northern Trust.

“The mandate supports Artemis’ focus on growth and complements our existing relationship: driving efficiencies through our global technology architecture, straight-through-processing and an integrated service proposition – from execution to custody – that now supports the complete lifecycle of its investments.”

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Chris Jackson, Yorke O’Leary

OptAxe stated that it is launching the new venue to address fundamental shortcomings in FX options trading.

According to the firm, increased fragmentation in FX trading now presents substantial position distribution and coverage challenges, and places constraints on effective price discovery and execution options.

Elsewhere, the Uncleared Margin Rule and other regulatory requirements mandating initial margining for all trades have raised cost for FX options businesses, with bilateral trading margin requirements heavily impacting balance sheets. 

OptAxes’s solution sources and consolidates the best interest available in the market, in real-time. Axe inventory is aggregated by OptAxes into a single platform, acting as a multi-issuer venue rather than a multi-dealer platform, with RFQ and counterparty disclosure at the point of execution.

“OptAxe is a fully centralised, regulated venue for liquidity discovery, dissemination and execution that empowers trading participants with actionable insights from centralised liquidity information,” said Chris Jackson, chief executive and co-founder at OptAxe.

“We automate manual, bilateral processes and consolidate available axe inventory into a single platform, effectively acting as a multi-issuer, not a multi-dealer platform, RFQ-based venue”. 

The FCA authorisation follows a two-year process from participating in the FCA’s Pathway Programme to gaining a full trading venue licence, compliant with all the regulatory obligations of an MTF, from operational resilience to surveillance, trade reporting and regulatory data reporting.

“With OptAxe, all market participants can easily access a centralised source of actionable axe inventory with evidence-based pricing that meets the demands of the trading community today and tomorrow,” said Yorke O’Leary, chief operating officer and co-founder at OptAxe.

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Broadridge added that it is also expanding its offerings to include other updated regulatory regimes and asset classes, including the Canadian rewrite scheduled for July 2025 and the Hong Kong rewrite slated for September 2025.

“We anticipate that the regulatory wave will continue, and we are proactively working on behalf of our clients to help them meet their compliance requirements,” said Ben Cooling, general manager, regulatory trade and transaction reporting at Broadridge. 

“The upcoming Canadian and Hong Kong rewrites are part of a global initiative aimed at enhancing the consistency and transparency of derivatives reporting, reflecting similar updates by regulators in the United States, Japan, and Europe.”

Read more: Fireside Friday with… Broadridge Financial Solutions’ Chris Perry

Following the addition of the European Money Market Statistical Reporting (MMSR), Broadridge is developing the US equivalent of SFTR for securities lending, the SEC 10c-1, scheduled to go live in January 2026.

The firm’s solution will also be upgraded to cater for major EU and UK Mifid updates scheduled to be implemented over 2025 to 2027, as well as the final updates to CFTC Dodd Frank Reporting.

Broadridge’s solution claims to simplify complex trading requirements, allowing firms to comply with a wide range of local rules, alongside being fully equipped to handle these changes, including the integration of Global Unique Transaction Identifiers (UTIs), Unique Product Identifiers (UPIs), and Critical Data Elements.

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