So why did LedgerX lie about offering Bitcoin futures to retail customers?

Apparently, it was the result of misunderstanding and confusion. Juthica Chou, chief operating officer at the company, implied to online publication Coindesk (which first broke the story) that they thought they’d been cleared to proceed with offering futures because the CFTC had not objected to their application. ““We filed on Nov. 8 and we have email correspondences confirming there were no additional items that they (CFTC) needed for the amendment,” she said.

The New York-based startup caused a splash on Wednesday after announcing it had become the first company to offer physically-settled bitcoin futures contracts. LedgerX CEO Paul Chou boasted that the contracts were for retail investors and customers on its new platform Omni would be able to transact using only Bitcoin. “We’re bitcoin-in, bitcoin-out,” he said. The crypto media (including this one) dutifully reported his quotes without bothering to verify the news.

CFTC Clarification Corrects LedgerX Claim

It took the CFTC to gatecrash the party. The regulatory agency clarified to Coindesk that LedgerX’s application for amendment to its DCO (Derivatives Clearing Organization) license was still in the final stages of approval. The amendment’s approval will allow LedgerX to begin offering futures contracts on its platform. “Every new or amended DCO application needs to be affirmatively approved by the Commission. The absence of a decision does not constitute approval, and entity self-certification is not an option,” a CFTC official told Coindesk.

Meanwhile, the startup is claiming that the conversation in the first news story about its futures contracts was actually about the launch of Omni – LedgerX’s derivatives platform focused on investors. Nikhilesh De, the Coindesk reporter who reported the original story, has not offered commentary. Others claim that the original story should have focused on swaps on LedgerX’s platform, an industry first.

Either way, the race to become the first service to offer physically-settled Bitcoin futures is still on between Bakkt, ErisX, and LedgerX. Kudos to LedgerX’s PR agency for generating a news cycle out of nothing. (They seem to have terminated their relationship with LedgerX after the incident.)