TD Ameritrade is one of the best online brokers in the US that had recently announced its plans to include cryptocurrency trading on their platforms. The broker has made significant progress in that sphere. It has begun offering Bitcoin Futures contract on its platforms. It also announced an investment in ErisX – a regulated Exchange of cryptocurrency trading.
Bitcoin Futures contract trading has already begun at the official TA Ameritrade platform. Nevertheless, currently, the futures contract is only open to high-volume traders. The minimum deposit amount for trading Bitcoin futures contracts is $25000. The traders would also require two advisory notes from CFTC and NFA to acknowledge the risks associated with Bitcoins.
The apparent risk associated with trading Bitcoin and cryptocurrencies has often motivated the firms to restrict the trading to institutions. These institutions are better equipped to manage and analyze large fluctuations in the market through its liquidity and expertise.
Nevertheless, the ErisX platform is expected to be open to all retail traders as well. The firm plans to offer both spot exchanges and futures contract based on cryptocurrencies. ErisX is a CFTC-regulated derivatives exchange and clearing organization that will offer digital asset futures and spot contracts. The blog post on TD Ameritrade noted about the investment in ErisX,
“This strategic investment is yet another way to demonstrate our ongoing commitment to innovation—and bring our clients a best-in-class investing and trading experience.”
The futures and spot markets initiated by traditional platforms are the building stones for the Bitcoin’s case as an asset. The volume on these regulated Exchanges if sufficient enough will motivate the regulators to approve other cryptocurrency based financial products like ETFs and payments in the future.
Do you think there will be sufficient volume of Bitcoin Futures trading on TD Ameritrade? Will existing cryptocurrency exchanges lose their dominance? Please share your views with us.