Blockchain Startup EverMarkets Enters Race for Bitcoin Futures
A new blockchain startup by the name of EverMarkets has announced its foray into the bitcoin derivatives industry, where it will compete alongside CBOE and CME Group.
EverMarket Launches Blockchain-Powered Exchange
After a year of development, a team of experienced traders have unveiled EverMarkets, a new derivatives platform and clearing house for bitcoin and other financial assets. The EverMarkets Exchange (EMX) will launch later this year for non-U.S. residents and will future both cryptocurrency and traditional futures contracts.
The bitcoin derivatives market is only a few months old but is already dominated by high-speed traders on Wall Street. According to the official press release issued by the company, EverMarkets is being designed to one day compete with the major exchanges and do so in a manner that benefits smaller investors who don’t have access to the speed-trading algorithms currently employed by the big banks.
EMX will also feature significantly lower fees and pro-rate call auctions, which reduces volatility and improves executive of larger orders.
“EverMarkets will play a vital role in the adoption of cryptocurrencies throughout the wider financial industry over the next several years, and achieving that means creating a market that is secure, reliable and trusted; which is what we’re committed to doing,” CEO and founder James Bai said in a statement. “More than just transforming the futures markets, we intend to demonstrate how cryptocurrencies and blockchain can make every aspect of trading much more efficient and safe.”
The Palto Alto-based company is also panning to issue its own cryptocurrency, EVR, which will be used as a unit of transaction, settlement and administration. Specific details about the token sale have not yet been announced.
The Rise of Crypto Derivatives
Leading derivatives players CBOE and CME rushed to launch their bitcoin futures products in December amid much fan-fare. At the time, bitcoin was hitting record high after record high, with demand so big that leading crypto exchanges had to temporarily shut their doors to new registrants. Since the new year, bitcoin and its altcoin peers have experienced multiple crashes. Although declines have been multifaceted, the fear of new regulations has been consistent throughout.
Traders have long yearned for alternative ways to invest in the crypto boom without having to deposit their money on volatile exchanges. Multiple hacking attempts, both successful and unsuccessful, have also plagued the major exchanges and called into question whether existing regulatory measures are enough.
Against this backdrop, derivatives products may become more attractive for investors seeking exposure to cryptocurrency. In addition to EMX, Nasdaq is also reportedly developing its own bitcoin futures product that could launch sometime this year.
Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.