tZERO said the CFTC registered its subsidiary tZERO DCM as a designated contract market, satisfying the first earn-out milestone in its planned SPAC merger.
Key Facts
The CFTC approved the registration of tZERO DCM as a designated contract market, authorizing it to operate a regulated derivatives exchange, tZERO said.
The approval follows the CFTC's Oct. 16 registration of tZERO DCO as a derivatives clearing organization, giving tZERO both exchange and clearing registrations, tZERO said.
tZERO said the two approvals satisfy the first earn-out milestone under its Oct. 31 merger agreement with SPAC FG Imperii Acquisition Corp.
tZERO said the Commodity Futures Trading Commission approved its subsidiary tZERO DCM as a designated contract market, authorizing it to operate a regulated derivatives exchange.
The approval, announced on Wednesday, follows the CFTC's Oct. 16 registration of tZERO DCO as a derivatives clearing organization, giving tZERO both exchange and clearing registrations, the company said.
"Securing both exchange and clearinghouse approvals is a major achievement for tZERO," CEO Alan Konevsky said in a press release.
tZERO now holds CFTC exchange and clearing registrations. Source: tZERO
SPAC Earn-Out Milestone
Under tZERO's Oct. 31 merger agreement with FG Imperii Acquisition Corp., the first earn-out milestone is satisfied once the Commodity Futures Trading Commission approves both registrations, tZERO said. It said it has now met that target.
tZERO agreed on Oct. 31 to go public through the FG Imperii deal at a $350 million pre-money valuation, with the combined company expected to trade on NYSE American as TZRO.
A Derivatives Business
The registrations let tZERO support trading and clearing in the derivatives market through its own regulated entities and develop exchange and clearing services for financial institutions, the company said.
"Most holders of these capabilities use them to support their own books of business," Konevsky said, adding that tZERO aims to offer them as an independent service. The new business adds to tZERO's broker-dealer, alternative trading system, digital asset securities custody, transfer agency, and clearing and settlement services.
Digital asset firms are also building out CFTC-regulated businesses. Anchorage Digital said last week it had applied to register as a swap dealer.
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