Anchorage Digital has applied for swap dealer registration with the Commodity Futures Trading Commission (CFTC) to expand the company's institutional crypto options business. Anchorage's statement said Anchorage Digital Swap Dealer, LLC submitted the application to the National Futures Association (NFA). The NFA is reviewing the application, and registration remains pending. CEO and co-founder Nathan McCauley declined to estimate the review's duration and said Anchorage would provide updates as appropriate.
McCauley said Anchorage Digital Swap Dealer expects to offer European-style bitcoin and ether options if registration is approved. The planned options would have maturities of up to one year. McCauley said the firm plans additional products later, subject to internal approvals and regulatory requirements. McCauley said completed registration would let institutional clients trade digital asset derivatives with a CFTC-registered counterparty while using Anchorage Digital's custody and other services.
Anchorage said public companies holding bitcoin and ether on company balance sheets have accounted for much of the growth in Anchorage's existing options business. Anchorage said asset managers and funds managing exposure through options have also contributed to that growth. McCauley declined to provide trading volumes or growth figures. McCauley also declined to describe how Anchorage previously arranged client options trades. McCauley said institutional demand for regulated digital asset derivatives access continues to increase and described the dedicated swap dealer entity as infrastructure to meet that demand.
Anchorage Digital Bank, N.A. received the first federal charter for a digital asset bank in 2021. The Office of the Comptroller of the Currency regulates the bank. Anchorage said the swap dealer entity would be subject to CFTC capital, risk management and margin requirements. Anchorage said those requirements follow the Dodd-Frank Act framework applied to banks in interest rate, credit and foreign exchange markets. McCauley said registration would place Anchorage's options business within the same federal framework as the dealers clients already trade with.
Anchorage Digital introduced collateral management on the company's Atlas platform in March. The features include round-the-clock monitoring and automated margin calls for loans, derivatives and other institutional transactions. Anchorage also bought Securitize's wealth management unit in December to broaden federally regulated crypto services for registered investment advisors.