BITCOIN, BLOCKCHAIN

CME Group to Launch Bitcoin Options in Q1 2020

CHICAGO – CME Group today announced it will launch options on its bitcoin futures contracts in Q1 2020, pending regulatory review.

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Tim McCourt, CME Group Global Head of Equity Index and Alternative Investment Products.
Tim McCourt

“Based on increasing client demand and robust growth in our Bitcoin futures markets, we believe the launch of options will provide our clients with additional flexibility to trade and hedge their bitcoin price risk,” said Tim McCourt, CME Group Global Head of Equity Index and Alternative Investment Products.

“These new products are designed to help institutions and professional traders to manage spot market bitcoin exposure, as well as hedge Bitcoin futures positions in a regulated exchange environment.”

Since their launch in December 2017, market users have rapidly adopted CME Bitcoin futures for their hedging and trading needs.

There have been 20 successful futures expiration settlements and more than 3,300 individual accounts have traded the product since inception.

Year to date, nearly 7,000 CME Bitcoin futures contracts (equivalent to about 35,000 bitcoin) have traded on average each day.

At the same time, institutional interest continues to build with the number of large open interest holders reaching a record 56 in July.

CME Group is the only derivatives marketplace where customers can hedge or trade benchmark options on futures across every investable asset class, with average daily volume of 4.3 million in 2019 to date.

By launching Bitcoin options, the company is providing clients with additional tools for precision hedging and trading.

As the world’s leading and most diverse derivatives marketplace, CME Group enables clients to trade futures, options, cash and OTC markets, optimize portfolios, and analyze data – empowering market participants worldwide to efficiently manage risk and capture opportunities.

CME Group exchanges offer the widest range of global benchmark products across all major asset classes based on interest rates, equity indexes, foreign exchange, energy, agricultural products and metals.

The company offers futures and options on futures trading through the CME Globex® platform, fixed income trading via BrokerTec and foreign exchange trading on the EBS platform.

In addition, it operates one of the world’s leading central counterparty clearing providers, CME Clearing.

With a range of pre- and post-trade products and services underpinning the entire lifecycle of a trade, CME Group also offers optimization and reconciliation services through TriOptima, and trade processing services through Traiana.

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BITCOIN, BLOCKCHAIN

CME Group Launches First Bitcoin Futures

CME Group began trading their first bitcoin futures today with more than 200 contracts purchased in the first hour with its Jan. 18 contracts opening above $20,000.

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Earlier this month, the Chicago Board Options Exchange (CBOE) website crashed Sunday night after the firm launched its first bitcoin futures contracts.

CME’s site has remained online but the cryptocurrency did see a sell-off, falling to a low of $18,355.

As with CBOE and now CME Group, the bitcoin future contracts have primarily been aimed at institutional investors.

NASDAQ as well as Cantor Fitzgerald both announced expected launches of bitcoin related products in the upcoming year.

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BITCOIN, BLOCKCHAIN

CME Group, CBOE to Begin Bitcoin Futures December 18

CME Group, the Chicago Board Options Exchange (CBOE), and Cantor Fitzgerald have all announced the listing of cryptocurrencies will begin on December 18.

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Terrence A. Duffy
Terrence A. Duffy

“We are pleased to bring bitcoin futures to market after working closely with the CFTC and market participants to design a regulated offering that will provide investors with transparency, price discovery and risk transfer capabilities.” Said Terry Duffy, chairman and CEO of CME Group.

CME had previously specified a launch date of December 11 but has since retracted the statement clarifying that trading will begin on the new date of December 18.

RELATED: Nasdaq Inc. is seeking to join the cryptocurrency market and aims to launch bitcoin futures in the first half of 2018.

CBOE and CME will present cash contracts that will find customers purchasing exposure to different reference rates that will not the individual to own the cryptocurrency.

CME has stated they will be using a reference rate created by Crypto Facilities, a partner of the firm.

However, CBOE plans to utilize the price from Gemini, a New York-based cryptocurrency exchange.

Cantor Exchange, a subsidiary of Cantor Fitzgerald, has said they will over bitcoin binary options, also beginning on December 18.

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BITCOIN, BLOCKCHAIN

CME Group Prepares to Begin Bitcoin Futures December 11

CME Group, the largest derivatives exchange in the world, has published more information concerning upcoming bitcoin futures and announced they will begin trading on Dec. 11, excluding any unforeseen adjournments from regulators.

“Effective Sunday 10 December 2017 for trade date Monday 11 December 2017, and pending all relevant regulatory review periods, please be advised that CME will launch Bitcoin Futures,” stated the company’s website.

RELATED: Bitcoin Hits New All-Time High of $8,270, Market Cap Exceeds $136 Billion

The cryptocurrency contracts will be settled in cash utilizing CME’s existing bitcoin price indices.

The company also addressed how they will manage hypothetical substantial price swings.

“Special price fluctuation limits equal to 7% above and below prior settlement price and 13% above and below prior settlement price and a price limit of 20% above or below the previous settlement price. Trading will not be permitted outside the 20% above and below prior settlement price,” the company clarified.

Terrence A. Duffy
Terrence A. Duffy

“Given increasing client interest in the evolving cryptocurrency markets, we have decided to introduce a bitcoin futures contract. As the world’s largest regulated FX marketplace, CME Group is the natural home for this new vehicle that will provide investors with transparency, price discovery and risk transfer capabilities,” said Terry Duffy, CEO of CME Group.

Recent attempts to generate financial creations that deal with cryptocurrency have been dismissed, predominantly that which include the formation of derivatives agreements.

However, it’s not entirely impossible.

LedgerX, a New York-based cryptocurrency trading platform, obtained the agency’s authorization to clear derivatives in July, and started presenting institutional clients the capability to trade bitcoin options two weeks ago.

Paul L. Chou

LedgerX CEO, Paul Chou, said the company has cleared $1 million in the first week, followed by $2 million in the second week.

Chou said he foresees more exchanges inaugurate equivalent products.

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BITCOIN, BLOCKCHAIN

CME Group to Begin Trading Bitcoin Futures

CHICAGO — The Chicago Mercantile Exchange (CME) announced Tuesday that it intends to commence bitcoin futures in the fourth quarter, awaiting regulatory approval.

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Terrence A. Duffy
Terrence A. Duffy

“Given increasing client interest in the evolving cryptocurrency markets, we have decided to introduce a bitcoin futures contract. As the world’s largest regulated FX marketplace, CME Group is the natural home for this new vehicle that will provide investors with transparency, price discovery and risk transfer capabilities,” said Terry Duffy, CEO of CME Group.

The precise date it will made public has yet to be disclosed but CME did say that the futures would be paid in cash as well as the price would be based off the CME CF Bitcoin Reference Rate, an index the company began in Nov. 2016 in partnership with Crypto Facilities.

According to CME, the project is dependent on authorization from the U.S. Commodity Futures Trading Commission.

“We’ve been working with the regulator. They understand our application. And they understand our model very, very well,” Duffy said.

Recent attempts to generate financial creations that deal with cryptocurrency have been dismissed, predominantly that which include the formation of derivatives agreements.

However, it’s not entirely impossible.

LedgerX, a New York-based cryptocurrency trading platform, obtained the agency’s authorization to clear derivatives in July, and started presenting institutional clients the capability to trade bitcoin options two weeks ago.

Paul L. Chou
Paul L. Chou

LedgerX CEO, Paul Chou, said the company has cleared $1 million in the first week, followed by $2 million in the second week.

Chou said he foresees more exchanges inaugurate equivalent products.

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