FTX US Plans to Enter Equity Options Market after Stock Trading Expansion
Sam Bankman-Fried‘s US affiliate of the FTX cryptocurrency derivatives exchange recently celebrated the expansion of its stock trading to all 50 states. According to reports, FTX US is about to trigger another step by preparing to enter the equity options market.
FTX US Is Interested in Entering Equity Market
Brett Harrison, the president of FTX US, confirmed this in an interview with Bloomberg. However, no specific timeline was given. A further discussion with a spokesperson of the company also disclosed that the launch of options is subjected to regulatory review. Harrison believes that the company might be in a good position to capitalize on the opportunities that may come in the future bull run by growing the offering while asset trading is slowing down.
Options have over the years been seen as a provable tool for hedging an underlying position or for speculating on a particular asset. This has been a very lucrative business for exchanges such as Robinhood Markets Inc (NASDAQ: HOOD). It is important to note that Robinhood made nearly $70 million in options payments for order flow at the peak of the market. This was more than the $49 million in PFOF for trading in non-S&P 500 stocks.
FTX US Launches Zero-Commission Stock Trading
Recently, FTX US launched zero-commission stock trading as part of its plan to bring crypto and stock investment into the same space for retail investors. Harrison admitted that the company may incur some loss in the initial stage of its stock trades. However, this could be recovered in other services including crypto trading as well as selling its basic crypto services to other brokers and financial service providers. The FTX US president also mentioned that they added the stock trading service for their customers to complement their existing business.
“If they want to invest in stocks, they’re not going to want to have to split their savings between two different apps, or have to move money around between two different accounts,” said Harrison. “They’d like to be able to have one holistic experience where they can invest in multiple asset classes from a single app and experience. That’s what we’re hoping to provide by combining stocks and crypto into the same application for our user,” he added.