One Trading Receives Dutch Regulator Approval, Becomes EU’s First Regulated Crypto Derivatives Exchange

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The Financial Markets Authority (AFM) in the Netherlands approved One Trading’s license to list and trade futures and crypto derivatives. With this move, One Trading became the first exchange in Europe and the UK to engage in cash-settled trading for perpetual futures.

The landmark allows the European cryptocurrency exchange to introduce innovative financial products across Europe.

In his statement, Mr. Barraclough reiterated his commitment to an exchange that abides by the highest regulatory standards while also being at the cutting edge of trading. In a move that seemingly wants to appease both types of customers, retail and institutional investors, One Trading’s cash-first approach might give it a unique advantage:

‘(…) we are well positioned to (…) offer institutional-grade solutions to all customer types starting with BTC and ETH products where no onshore EU regulated venue currently exists.’

We are delighted to announce @OneTradingEU has been granted an Organised Trading Facility (OTF) License by the Dutch financial regulator bringing crypto futures onshore in the EU.

With this new licence, One Trading becomes the only perpetual futures trading venue in the EU. pic.twitter.com/hzkAVwmlce

— One Trading (@OneTradingEU) July 29, 2024

Crypto Trading Is Not As Simple As Used to Be 

Given the rise in popularity of US-based Bitcoin ETFs and soon-to-launch Ethereum ETFs, the EU trading venue might be onto something. Individuals and institutions are eager to invest in crypto futures, and this demand has only been growing in recent years with the rise in popularity of the foremost crypto coins, BTC and ETH.

 To enhance the security for European customers and the regulatory framework, One Trading has confirmed they plan to integrate crypto derivatives as ‘traded on a trading venue’ instruments.

Having custody and settlement in one place allows it to meet EU collateral requirements for derivative transactions via crypto assets. This was an important step for obtaining regulatory approval, as margin requirements are much steeper in the EU and UK than in the US.

Mario Hoessl-Neumann, general counsel of One Trading, attested that working with Dutch regulators was a ‘great experience’ and that the exchange appreciates AFM’s vision for a secure and stable derivatives market in the EU. 

Amidst all the recent recession talks from pundits, oversight in derivatives trading is more important than ever. For instance, we now know that the 2008 Credit Crisis was massively catalyzed by unregulated OTC derivatives, among other things.

Gary Gensler, the SEC’s Chairman, recently informed senators that the final approvals for ETH ETFs should be fully completed by the end of this summer, thereby adding another turn of the screw to futures trading in the US.

One Trading Lands Industry First in EU Futures Trading

As One Trading grows in popularity among institutional and retail investors, it will be interesting to see the dynamics of crypto futures in the EU versus the US play out. Does regulation bring more stability to the market, or is it hampering competition?

For now, One Trading has captured invaluable mindshare in the EU crypto space, which will invariably attract more customers, bolster their balance sheet, and further bring crypto trading into the mainstream.

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