- CME group has introduced options on its Bitcoin futures contracts at around 15.00 UTC on Monday.
- CME had differentiated itself by being one of the first platforms to launch cash-settled bitcoin futures at the end of 2017.
- CME further hopes to launch its Bitcoin options before Bakkt’s launch of Bitcoin futures in September.
Chicago based exchange platform and global markets company, CME group has introduced options on its Bitcoin futures contracts at around 15.00 UTC on Monday. The launch on CME Globex has contracts quoted in US dollars. Each contract represents 5 BTC, and central clearance is g used to avoid counterparty risk.
The Bitcoin price is being tracked accurately through CME following and mapping the trade flow data from several major bitcoin exchanges to make the decision collectively. The much-awaited move is now open for trading for all.
Bitcoin derivatives, which often regarded as the world’s largest Casino has been available across crypto-asset exchange platforms since 2014. CME had differentiated itself by being one of the first platforms to launch cash-settled bitcoin futures at the end of 2017. This offered regulated products to its users and increased its popularity.
2019, on the other hand, led to a strong start for Bitcoin Options. Analytics firm Skew reported that last week’s data showed that daily volumes rose and surpassed USD 90 million by Friday.
Currently, more than 95% of this trade happens on the Dutch-based exchange platform Debit, which is in the process of shifting its operations to Panama for regulatory reasons.
FTX, the Binance backed derivatives platform, has also contributed to the options trend by launching its Bitcoin options contract through an announcement on Sunday.
Even after being currently unavailable to US customers, the trade volume crossed $1 million in just two hours after the launch, according to its CEO Sam Bankman Fried, showcasing the popularity of the trend.
CME further hopes to launch its Bitcoin options before Bakkt’s launch of Bitcoin futures in September. Bakkt owned by Intercontinental Exchange (ICE) and the rival platform announced the launch of its possibilities and cash-settled contracts in December last year.
CME had previously denied having plans on physically delivered futures anytime soon. Bitcoin derivatives have received mixed responses from the market prior.
CoinDesk’s Bitcoin Price Index shows that Bitcoin hit an all-time high of $20000 shortly after the announcement of CME futures but plunged up to $2000 soon after Bakkt’s futures contracts launch.
Global market strategy analyst Nikolaos Panigirtzoglou stated in a note on Friday that he could see signs that the institutional investors were preparing for CME’s CME’s Launch.
According to data from the exchange, open interest for Bitcoin futures has raised 69% from the end of the last year to last Friday which is a 7-month high. Surprisingly, the Bitcoin price has not shown movement after the announcement.
– Panigirtzoglou wrote, as reported by Bloomberg.