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Crypto futures exchange CoinFLEX lands $10M funding to offer physical delivery of bitcoin contracts

Tue, 27 Aug 2019, 05:08 am UTC

Cryptocurrency futures exchange CoinFLEX has scored $10 million funding from Polychain Capital, CEO Roger Ver, as well as NGC Ventures and Divergence Digital Currency.

According to the South China Morning Post (SCMP), the Hong Kong-based firm claims to be the first exchange in the world that provides physical delivery of Bitcoin futures contracts.

Speaking to the news outlet, CoinFLEX CEO Mark Lamb said that physical delivery of contracts ensures that neither spot nor futures prices are manipulated.

Professional and retail traders alike are affected by price manipulation in the cash settled futures market. In physical delivered contracts, anyone long at expiry receives the underlying bitcoin. There are no formulas involved,” Lamb said.

Lamb said that physical settlement helps lessen the increasing attempts of price manipulation of experienced traders who are exploiting the lower bitcoin spot volume versus futures, which is 1.5 times bigger.

He was also not shy to reveal that CoinFLEX is targeting crypto exchange BitMEX, which trades the second most bitcoin futures contracts, with a daily volume of $2.86 billion. BitMex recently announced it will restrict users from Hong Kong, Seychelles, and Bermuda from accessing its platform, as these regions are hosting its headquarters and staff. The move was made to ensure “continued compliance” to promote transparency and show third parties that BitMEX is a safe trading place.

In March, CoinFLEX also launched its FLEX coin to encourage liquidity and reward members who trade on the platform. A set of amount of FLEX coin will be paid out to traders every day according to the proportion of the volume they trade as a taker, relative to the daily volume on the platforms. The coin can also be swapped for a discount on the cost of using the platform’s services.

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