While futures contracts based on the most popular cryptocurrency, bitcoin (BTC), have made their debust across major cryptocurrency exchanges across the globe, the similar offerings for other altcoins have been limited. Dollar-denominated futures contracts that will have litecoin as their underlying will go live for trading on Friday on the Crypto Facilities platform. These contracts will come with weekly, monthly and quarterly expiry periods and allow traders and investors to take long and short positions.
The exchange currently supports trading in bitcoin, ethereum (ETH), ripple (XRP) and litecoin and offers futures trading in bitcoin, ethereum and ripple with up to 50 times leverage available to eligible traders. (See also: Bitcoin Vs. Litecoin: What's The Difference?)
While the bitcoin and ripple futures were available for trading for a while, the ethereum-based futures contracts were added by Crypto Facilities just a month back. Owing to the popularity of ethereum cryptocurrency trading, the cryptocurrency exchange expects its trading volume to shoot up to $150 million this quarter. That will constitute around 10% of its overall trading volume. With litecoin futures getting added to the list by the end of this week, the exchange is set to offer a complete set of futures trading options based on all supported currencies.
Alternative Medium to Trade Litecoin
The launch of litecoin futures will provide a new market both for retail investors as well as the institutional investors who will now find it easier to hedge, arbitrage or speculate on litecoin price movements. The offering is expected to further boost the liquidity in litecoin. Litecoin creator Charlie Lee believes that litecoin futures will "make it easier for people to get in and out of litecoin," reports CoinDesk. (See also: Who Is Charlie Lee, Litecoin Founder?)
Timo Schlaefer, CEO of Crypto Facilities, said the decision is a result of having received "strong client demand" for litecoin contracts. "We believe our LTC-dollar futures contracts will increase price transparency, liquidity and efficiency in the cryptocurrency markets," he said. (See also: How The Futures Market Works?)
Litecoin ranks as No. 6 in the list of cryptocurrencies with the largest market capitalizations: around $5.48 billion as of this writing. It was trading at an exchange price of $96.08 Wednesday morning, down around 3.7% over the last 24-hour period. (See also: Will Litecoin Plunge Below $100?)