crypto.com's Derivatives Exchange Nadex Adds Memecoin Contracts
Crypto.com's US-based derivatives exchange, Nadex, has introduced four new derivatives contracts linked to popular memecoins. These memecoins include PEPE, FLOKI, Dogelon Mars (ELON), and BONK, aiming to provide traders with more options for investment.
The total Market capitalization of these four memecoins amounts to nearly $7 billion, as reported by CoinMarketCap. Nadex's new "touch bracket" derivatives contracts serve as hedging tools that pay out if a Token's spot Price hits a predetermined ceiling or floor before the contract's expiration.
Benefits of Touch Bracket Contracts
- Popular in high volatility markets like cryptocurrency
- Minimize the risk of contract manipulation
According to filings with the United States Commodity Futures Trading Commission (CFTC) on October 7, these touch bracket contracts are designed to operate efficiently in volatile markets, offering traders a level of Security against manipulation.
Regulatory Approval for Derivatives
Unlike traditional financial products, self-certified derivatives like those offered by Nadex do not require explicit regulatory approval before being listed. These innovative contracts provide a new avenue for traders to diversify their portfolios and manage risk effectively.
Nadex's Growing Cryptocurrency Derivatives Portfolio
Nadex already offers cryptocurrency derivatives products tied to Bitcoin, catering to the growing demand for regulated trading options in the Digital asset space. In 2023, the total trading volumes for Nadex contracts linked to BTC, ETH, and Litecoin exceeded 28 million contracts, highlighting the exchange's commitment to meeting the needs of the trading community.
"As the demand for diverse and regulated cryptocurrency products continues to rise, Nadex remains committed to expanding its commodity derivative offerings," stated a spokesperson for the exchange.
Industry Developments
In a recent industry Development, Kalshi, another derivatives exchange, secured a Legal victory against the CFTC in September. Following this success, Kalshi was able to list event contracts for Betting on US election results, showcasing the evolving landscape of derivative trading in the digital asset space.
For more information on the legal landscape surrounding cryptocurrency, check out Crypto.com's recent lawsuit against the SEC over regulatory matters.
