A crypto exchange backed by Citadel Securities is creating the first blockchain-based derivative of the Korean won versus the US dollar, one of Asia’s busiest currency pairs.
EDXM International, the global arm of US-based EDX Markets, plans to launch a perpetual futures contract tracking the won. The goal is to create a cheaper, digital alternative to traditional non-deliverable forwards, or NDFs, which are used to bet on restricted currencies.
To achieve this, EDXM is relying on a won and dollar stablecoin pair. This includes KRWQ, a first-of-its-kind won-backed stablecoin launched in October offshore, outside South Korea’s regulatory reach, by Cayman Islands-based Brainpower Labs. Trades are settled in USDC, a dollar stablecoin issued by Circle Internet Group.
“Trading stablecoin perpetuals is a lot more efficient than NDFs, as these can be settled real-time without the need for banking relationships and is much cheaper to take long or short exposure on KRW versus NDFs,” EDXM International Chief Executive Officer Kai Kono said. He added that the product will launch by early April.