FTX US Derivatives (Formerly LedgerX)

What Is FTX US Derivatives (Formerly LedgerX)?

FTX US Derivatives (formerly LedgerX) is a digital currency futures and options exchange and clearinghouse. It was regulated by the Commodity Futures Trading Commission (CFTC).

The exchange offers physical settlements of all contracts, block trading, and algorithmic trading opportunities for institutional investors. It also allows direct access for all traders.

Understanding FTX US Derivatives (Formerly LedgerX)

FTX US Derivatives (formerly LedgerX) was the first exchange to offer cryptocurrency contracts in the U.S. Contracts for bitcoin, called mini-contracts, sold in increments of 0.01 BTC; ether contracts are called deci-contracts and sold in increments of 0.10 ETH. These fractional contracts enabled investors to make granular trades and allow for scalability as the markets fluctuate.

FTX US Derivatives was registered with the CFTC as a Designated Contract Market, Derivatives Clearing Organization, and a Swap Execution Facility.

In October 2021, FTX US acquired LedgerX, which changed its name to FTX US Derivatives. FTX US Derivatives offers cryptocurrency futures, options, and swaps—all of which were physically delivered instead of cash-settled.

In November 2022, FTX went bankrupt and its founder Sam Bankman-Fried stepped down as CEO. FTX US Derivatives, however, was not a part of its bankruptcy proceedings.

Futures Trading

Like a regular futures contract, the company's cryptocurrency futures contracts allows investors to buy or sell at a predetermined price and time in the future. Contract sizes depend upon the cryptocurrency and move in $1 increments. FTX US Derivatives offers contracts for the current and following month and two quarterly settlements.

Swaps

The swap contracts from FTX US Derivatives offers investors an inexpensive way to buy or sell cryptocurrency. Swap contracts are priced at $0.05 eachAll futures and swap contracts are fully collateralized. A service for institutional investors allows for the direct negotiation of block trades, with FTX US Derivatives acting as the clearinghouse.

Investing in cryptocurrencies and other Initial Coin Offerings (“ICOs”) is highly risky and speculative, and this article is not a recommendation by Investopedia or the writer to invest in cryptocurrencies or other ICOs. Since each individual's situation is unique, a qualified professional should always be consulted before making any financial decisions. Investopedia makes no representations or warranties as to the accuracy or timeliness of the information contained herein. As of the date this article was written, the author does not own Bitcoin.

Correction—Feb. 8, 2023: This article has been corrected to reflect that FTX US Derivatives is one of the FTX-related properties that were not a part of its bankruptcy proceedings. The company remains operational today.