Aspiring CME Director Wants Exchange to Mine Bitcoin and Issue Tokens
A nominee for a CME director position argued for tokenizing certain shares and building renewable energy sources which could also mine crypto.
A nominee for a CME director role believes the Chicago-based exchange, one of the few regulated providers for crypto derivatives, should issue its own tokens and mine bitcoin with renewable energy.
In a filing to the Securities and Exchange Commission (SEC) Wednesday, Dante Federighi said that if elected, he would turn CME B-shares into "New_CME_Tokens" to improve governance by making membership accessible and improve liquidity.
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, the position Federighi seeks.
Federighi, a CME member since 1997, argued the exchange would need to create as many as 9,600 CME tokens, each representing hundredths 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," Federighi said in his proposal. Tokens would "enable future owners to gradually buy into a membership over time."
Federighi 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 he stands by all of his proposals. He declined to comment further, citing the rules of the election process.
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.
Learn more about Consensus 2023, CoinDesk’s longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.