The new US dollar-denominated contracts will offer both long and short trading terms, with weekly, monthly and quarterly maturities. Notably, the contracts will have Litecoin as their underlying collateral, unlike the already existing Bitcoin (BTC) futures contracts on such exchanges as CME and CBOE.
Crypto Facilities CEO Timo Schlaefer told Cointelegraph that the trading platform made its decision in response to "significant client demand for a futures product referencing Litecoin,” given that it is “one of the most liquid cryptocurrencies.”
The launch of LTC futures comes just a month after Crypto Facilities began offering Ethereum (ETH) futures contracts to investors, alongside its existing crypto derivatives based on Ripple (XRP) and Bitcoin (BTC).
Schaefer told Cointelegraph that crypto futures contracts on the platform have shown “extremely strong growth” in trading volumes, “up 84% in Q1 2018 vs Q4 2017”:
“We expect to see around 100% growth in volumes [across our crypto futures contracts] in Q2 vs Q1 this year…. monthly XRP volumes are at around $125 [million], up from $30 [million], in February. Following the launch of ETH in May, we’ve seen significant adoption of the product and expect around $150 [million], in volume this quarter.”
Crypto futures contracts have attracted a great deal of controversy this month, with Fundstrat’s Tom Lee attributing Bitcoin’s “gut-wrenching” price weakness and “significant volatility” to the timing of CBOE futures contract expirations.
A research paper released June 13 by academics at the University of Texas alleged that transaction patterns indicate that US-dollar back cryptocurrency Tether (USDT) is being used “to provide price support and manipulate...prices,” artificially deflating the price of Bitcoin to maximize short-term returns on futures contracts.
Yet further reports have surfaced this month suggesting that the U.S. Commodity Futures Trading Commission (CFTC) has been probing major U.S. crypto exchanges as part of its own investigation into possible price manipulation on Bitcoin futures markets.