Singapore Exchange (SGX), is launching a new product, SGX FlexC FX Futures, with the aim of “futurising” certain OTC FX product offerings.
Targeted for launch on August 27, SGX FlexC FX Futures - developed in consultation with market participants - enable bilateral trades that are privately negotiated with tailored expiration dates to be registered and cleared like a standard SGX FX futures contract. This feature will be available for INR/USD, KRW/USD, TWD/USD, USD/CNH and USD/SGD contracts.
Michael Syn, head of derivatives at SGX, says: "Access to counterparty credit, especially for tenors longer than spot, is increasingly scarce and expensive in the OTC FX markets.
New research from the International Swaps and Derivatives Association shows that the incentives offered by regulators to clear standardised interest rate derivatives is having a positive impact with more notional value being cleared than is mandated by the US Commodity Futures Trading Commission.
Encouraging the clearing of standardised derivatives has been a major priority for policy-makers and has primarily been pursued through the implementation of clearing mandates. ISDA says, however, that other incentives also exist – netting and capital benefits and the rollout of margining requirements for non-cleared derivatives, for example.
IHS Markit’s MarkitSERV has expanded its global network of derivatives clearinghouses by connecting to Asigna, the clearinghouse for Mexican listed and standardised derivatives.
With the new connection, it will provide standardised workflow and connectivity for matching, confirming and clearing Mexican peso TIIE 28 swaps.
“With the connection between MarkitSERV and Asigna, we can offer our clients an efficient and secure channel to transmit confirmed TIIE swap data to our clearinghouse,” says Catalina Clavé Almeida, CEO at Asigna. “It also helps global banks on the MarkitSERV network do business in our market.”
Coinbase, a cryptocurrency exchange based in San Francisco, has launched a new suite of services aimed at institutional level market participants.
With one of these services, Coinbase Custody, the firm says that it has leveraged its experience of safely storing more than $20 billion of cryptocurrency to create the most secure crypto storage solution available.
“In partnership with an SEC-regulated broker-dealer, Coinbase Custody is proud to offer a service that couples Coinbase’s cryptocurrency security excellence with third-party auditing and financial reporting validation that operates at the high standard of an SEC-regulated, custodial broker-dealer,” says Coinbase in announcing the news.
CME Group has launched a reference rate for ether, the native cryptocurrency of the Etherium network.
The CME CF Ether-Dollar Reference Rate, which will provide a daily benchmark price in US dollars at 4 pm London time, and CME CF Ether-Dollar Real Time Index, which will allow users access to a real-time ether price in US dollars.
Both the Ether Reference Rate and Ether Real Time Index will be calculated by Crypto Facilities and will be based on transactions and order book activity from two cryptocurrency exchanges: Kraken and Bitstamp.
CME and Eris Exchange have entered into an exclusive licensing agreement to list USD Eris interest rate swap futures, which already clear at CME Clearing.
Pending regulatory approval, Eris futures will be listed with and subject to the rules and regulations of CBOT, starting in the fourth quarter of 2018, and existing open interest in the contracts will be transferred to CME Group at that time.
The Eris futures will trade alongside the MAC swap futures. Until the migration in late 2018, Eris swap futures will remain listed at Eris Exchange and cleared at CME Clearing, where they are subject to margin offsets with CME Group's interest rate futures.
SGX has reported that 1.09 million FX futures contracts were traded on its platform last month, up 88% compared to April 2017.
This also represents the fourth consecutive month that the number FX contracts on the exchange have exceeded over 1 million.
The cumulative open interest for all FX contracts is up 37% m-o-m and 74% y-o-y. In April, SGX also reached the milestone of $ 1 trillion worth of cumulative notional trading in INR/USD and USD/CNH futures since their inception in 2013 and 2014, respectively.
The Monetary Authority of Singapore (MAS) says it will introduce regulations to require OTC derivatives to be cleared on central counterparties (CCPs) with effect from 1 October 2018.
MAS says central clearing will make the trading of OTC derivatives in Singapore safer as it mitigates counterparty credit risks inherent in these trades.
The mandatory clearing requirement will apply to Singapore dollar and US dollar fixed-floating interest rate swaps as these are the most widely traded interest rate derivatives in Singapore. Banks whose gross notional outstanding OTC derivatives exceed $20 billion will be required to clear their trades through CCPs that are regulated by MAS.
Cboe Global Markets has announced that its swap execution facility, Cboe SEF, has launched trading of USD/RUB and USD/PEN non-deliverable foreign exchange forward currency pairs.
The SEF, which launched NDF trading in December 2017, now supports trading in 12 pairs. Bryan Harkins, executive vice president and co-head, markets division, says, “As we continue to build this new market, we have received strong interest from firms across the globe, particularly buy-side firms, many of which have been interested in trading these newly-listed currency pairs.”
Cboe has formed a Markets division to unify product, sales, business development and account coverage personnel across the company's US equities and options, ETP listings, global derivatives and FX businesses.
The new division will be supported by multi-asset resource teams and headed by Andy Lowenthal and Bryan Harkins, who have been appointed executive vice presidents and co-heads. Lowenthal has been leading Cboe's global derivatives group, while Harkins led Cboe's US equities business, comprising four distinct stock exchanges, as well as the firm's global FX business