India Likely to Get Futures Exchange-Traded Funds for Bitcoin, Ethereum in Coming Days: Report

As the Government of India takes time to decide its position on cryptocurrencies, new possibilities for the growth of the crypto sector are pouring into the country as the year 2022 begins. A Memorandum of Understanding (MoU) has been signed between Torus Kling Blockchain IFSC and India INX will launch the first Bitcoin and Ethereum futures trading fund ( ETF), outside the United States. While the Torus Kling Blockchain is a joint venture between Cosmea Financial Holdings and Kling Trading India, India INX is the country’s first international stock exchange platform.

The MoU outlined responsibilities for launching the Indian ETF in three parts – India INX would be the trading platform, Cosmea Financial Holdings would distribute, and Kling Trading would act as the technology partner, the reports claimed.

In India, ETF futures contracts will allow more people to experiment with the crypto space without having to risk their capital or assets.

It is expected to be launched by the end of this financial year after obtaining approvals from the International Financial Services Centers Authority (IFSCA) and other relevant regulatory bodies.

IndiaInfoLine quotes V.

What are ETFs?

ETFs are regulated financial products and can represent a wide range of different assets. An ETF tracks the price fluctuations of an underlying asset like Bitcoin or Ethereum, giving people an alternative to take profits from the price trend without owning a single unit of the asset.

ETFs are a type of price tracking trading contract entered into by two parties.

The two parties agree to buy or sell the assets at a predetermined price at a later date.

A report from CoinDesk made it clear that the last day’s price of the underlying ETF asset – one way or another – cannot affect this contract and one of the parties ends up making a profit.

Other than removing the cost and requirement to store an asset, future ETFs make the commodity easier to buy and trade.

In addition, the profit margin that one of the parties to the contract can extract can be of considerable size.

On October 19, 2021, the first Bitcoin futures ETF was launched on the New York Stock Exchange, illustrating a validation moment in the emerging crypto space.

At the time, Bitcoin’s valuation soared to $64,476 (approximately Rs 48,51,174), close to its latest all-time high of $68,000 (approximately Rs 50.3 lakh) per coin surrounded by excitement among crypto enthusiasts.


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