SBI Group to Offer OTC Derivatives Trading in US After CFTC Approval

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Japanese financial giant SBI Group has announced plans to expand business partners and services in the US digital asset market. Megabank eyes entry into U.S. digital asset derivatives business

The bank said so in a to remark revealing that Clear Markets North America Inc., the U.S. subsidiary of Clear Markets (CM) in which it holds a 12% stake, has obtained approval from the Commodity Futures Trading Commission (CFTC) to offer over-the-counter offerings physically settled (OTC) derivatives of digital assets.

The approval is the first of its kind granted under the CFTC Swap Execution Facility (SEF) regulations, SBI noted. Clear Markets is the developer and operator of electronic trading platforms. SBI Alpha, the digital asset market maker of the SBI Group, has already carried out pilot transactions on its trading platform.

Meanwhile, Clear Markets will launch its OTC digital asset derivatives offering with USD/BTC options trading for institutional investors with plans to expand the products offered in the future. SBI remarked that the approval is a big step for the digital asset industry in the United States.

“In the United States, it takes a very long time to get approval for manipulation of crypto-assets (or approval cannot be obtained). We believe that the approval of new crypto asset derivatives by the CFTC this time will be a big step towards this latest development,” reads a translated excerpt from the Japanese notice.

With the vision of becoming a next generation financial platform in the digital age, SBI Group has invested in several other digital asset companies apart from Clear Markets. SBI Group has stakes in Swiss digital asset bank Sygnum, as well as Japanese exchanges TaoTao and FXCoin.

CFTC wants to expand its digital regulatory powers

The CM’s approval comes on the heels of agitation by the CFTC to expand its powers to oversee digital assets. The US commodity futures regulator has asked lawmakers to provide regulations that will give it a more central role in regulating digital asset derivatives and digital assets classified as commodities.

The fuss has paid off as two upcoming bills in the US Senate will elevate the CFTC’s authority if passed. The first is the Responsible Financial Innovation Act proposed by Senators Cynthia Lummis (R-WY) and Kirsten Gillibrand (D-NY). More recently, Senator Debbie Stabenow (D-MI) and John Boozman (R-AR) proposed the Digital Commodities Consumer Protection Act of 2022.

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