CME Group, the world’s biggest derivatives marketplace plans to launch Ether (ETH) futures in 2021.
The world’s biggest derivatives exchange announced it plans to launch Ether futures in February 8, 2021 pending regulatory approval.
Further details reveals that the new contract will be cash settled using CME’s CF Ether-Dollar Reference Rate which will serve as a once-a-day reference rate of the U.S dollar price of Ether. When cleared and launched successfully, Ether futures will be operated under the rules of CME Group.
This announcement is coming after Bitcoin (BTC) reached a new all time high price, breaking past it’s previous ATH of $20k. Ether (ETH) on the other hand reacted positively to the news and is presently trading above the $600 levels.
Tim McCourt, CME Group Global Head of Equity Index and Alternative Investment Products said:
Based on increasing client demand and robust growth in our Bitcoin futures and options markets, we believe the addition of Ether futures will provide our clients with a valuable tool to trade and hedge this growing cryptocurrency.
Ethereum is the second largest cryptocurrency by both market capitalization and daily volume. The introduction of listed Ether futures to our time-tested, regulated CME Group derivatives marketplace will help to create a forward curve so Ethereum market participants can better manage price risks.
There has been significant growth in adoption of CME Group’s Bitcoin futures by participants and including institutional clients. The CME Group Bitcoin futures and options was launched in 2017, it currently trades over 8,560 Bitcoin futures contracts (equivalent to 42,800 Bitcoin) per day. Ether futures will join CME Group’s Bitcoin futures and options.
Ether (ETH) futures will operate based on one contract equivalent to 50 ETH available on set hours from Sunday to Friday. This proposed launch of Ether futures by CME Group shows a variety of interest for Ether by an array of participants including institutions.