Analysis

A nominee for a CME director role believes the exchange, one of the few regulated providers for crypto derivatives, should issue its own tokens and mine bitcoin with renewable energy.

CME B-shares were distributed to CME members – the exchange’s main market participants – after demutualization in 2000. Compared to the publicly tradable A-shares, B-shares are only available to CME members and offer special voting-rights to elect six people to the board of directors, including one of the positons Federighil is standing for.

Federighil, a CME member since 1997, argued the exchange would need to create as many as 9,600 CME tokens, each representing 1/100th of a B-share. The blockchain could replace complicated legacy structures, with tokens redistributed to existing B-share holders, he said.

“Digitize and fractionalize B-shares into hundredths of a membership. Let them trade freely on a blockchain where all transactions and ownership are recorded,” Federighil said in his proposal. Tokens would “enable future owners to gradually buy into a membership over time.”

Federighil also proposed that CME should build its own renewable energy plants to power operations and “divert the excess energy to mine Bitcoin and other cryptocurrencies,” which could be “immediately converted” into fiat.

Not only would that create a new environmentally-friendly revenue stream, but it would also help familiarize the exchange with a new technology and asset-class, he argued.

“While this seems outside of our core competencies, I’d argue this is our business: we, like the miners, match and clear trades,” he said.

A footnote says the proposals were not checked by CME management and “some may not be feasible.”

Asked if he considered his measures radical, Federighi told CoinDesk that he stood by all of his proposals. He declined to comment further, citing the rules of the election process.

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