London-based GFO-X, the UK’s first regulated and centrally cleared trading venue dedicated to digital asset derivatives, has secured $30M (approximately €27.84M) in a Series B round of funding.
The funding aims to support GFO-X in its upcoming launch and drive innovation in the regulated digital asset sector.
The investment was led by M&G Investments, with M&G Investments joining the Board of Global Futures and Options Holdings.
M&G Portfolio Manager, Jeremy Punnett says, “The lack of regulated trading venues is materially hampering the growth of the crypto derivatives trading market.”
“The UK has the potential to become a global hub for crypto asset technology and investment, making London an excellent destination for GFO-X’s new global trading venue.”
“This investment enables GFO-X to scale its operations as the business is set to benefit from investors shifting their trading from unregulated to regulated venues,” adds Punnett.
Regulated digital asset derivatives
Founded in 2020 by Arnab Sen and Rajesh Melwani, GFO-X claims to be the first UK-regulated trading venue for digital asset derivatives, authorised by the UK Financial Conduct Authority and partnered with LCH SA for clearing.
Targeting large global institutional participants, GFO-X aims to provide a highly regulated, institutional-grade platform for digital asset derivatives trading.
The company focuses on delivering enhanced liquidity, institutional connectivity, and risk mitigation through advanced technology and optimised contract specifications.
Partnership with LCH SA
In April 2023, GFO-X formed a strategic partnership with LCH SA, a clearing house of the London Stock Exchange Group. LCH SA plans to launch LCH DigitalAssetClear, a new central counterparty clearing service for digital asset derivatives, pending regulatory approval.
Both companies have been working with an advisory working group comprising the world’s leading investment banks, trading firms and liquidity providers to optimise product design and risk methodologies.
The collaboration combines GFO-X’s digital asset market expertise and technology with LCH SA’s client base and risk management capabilities.
GFO-X co-founder Sen says, “Evolving regulation will bring digital assets into mainstream finance. This transition demands traditional market structures to solve the multiple risks currently associated with the digital asset market.”
“However, building a regulated financial market ecosystem is complex, time-consuming and expensive, and the pitfalls of taking shortcuts are now clear for all to see. The long-term viability of digital assets and the digitisation of real tangible assets requires careful collaboration between traditional market participants and modern innovators.”
“Having a patient long-term capital partner such as M&G is crucial as we build the next generation of global financial market infrastructure for digital assets.”
Corentine Poilvet-Clédière, CEO at LCH SA adds, “LCH SA is excited to be working with GFO-X, together with the industry, to provide a regulated marketplace for Bitcoin index futures and options as we look to expand our services to become a truly international clearing house.
“We look forward to the launch of the service, ensuring the safe growth and development of this asset class as demand from institutional market participants grows.”
01
Upstream Festival is back for its sixth edition! 4 solid reasons to mark your calendar