B2C2, a British market maker, announced on the 10th that it has conducted the first crypto non-deliverable forward (NDF) transaction with help from trading firm QCP Capital.
NDF, a type of derivative product, is a cash-settled, short-term, forward contract. The product is similar to futures trading, but the key difference is that counterparties settle the difference between contracted NDF price and the prevailing spot price in cash.
Like futures trading, NDF would allow traditional financial institutions to gain synthetic exposure to cryptocurrencies without the need to hold them.
According to the press release issued, B2C2 worked with cryptocurrency trading company QCP Capital to execute the NDF transaction. The NDF was dominated in US dollars with Bitcoin as the underlying asset. The companies have not disclosed the transactional amount.
“QCP views NDFs as a gateway to crypto markets for traditional financial institutions, such as investment banks, that are currently unable to handle the underlying assets,” said Darius Sit, co-founder of QCP Capital. “We are delighted to participate in this innovative product alongside B2C2, opening up a new crypto derivatives market.”