CME Group launched one new cryptocurrency product per month for reference rates, indexed and tradable products this year, compared to one per quarter in 2021.
On August 29, CME will launch Bitcoin-Euro and Ether-Euro futures, pending regulatory review. Tim McCourt, global head of equity and FX products at CME Group, told Markets Media that bitcoin-euro and ether-euro futures are the group’s eighth and ninth crypto contracts.
Tim McCourt, CME
“In 2022, we launched one new crypto product per month for reference rates, indexed and tradable products,” he added. “The cadence has increased from one per quarter in 2021.”
McCourt went on to say that the new contracts would be put in place Based on feedback CME has received from customers, the euro and US dollar are approaching parity and as euro-denominated cryptocurrencies, the second most traded fiat is behind the US dollar.
Additionally, the EMEA region represented 28% of the total bitcoin and ether futures contracts traded on the CME so far this year, up more than 5% from 2021.
Introducing Bitcoin Euro and Ether Euro Futures, a second currency pair in our market leading cryptocurrency futures. Starting August 29th, manage Bitcoin and Ether exposure in the underlying currency of your choice. https://t.co/PfN3hTCvWC pic.twitter.com/rci4NnAfKz
— CME Group (@CMEGroup) August 4, 2022
Edmond Goh, Head of Trading at B2C2, said in a statement, “CME Group’s launch of euro-denominated bitcoin and ether futures will help meet growing demand for regulated and robust non-USD crypto derivatives.”
McCourt went on to say that the new contracts will create trading opportunities in derivatives, exchange-traded notes, exchange-traded funds, and other CME liquidity pools, e.g. B. in foreign exchange, will be opened.
Kaiko, the crypto data provider, said in a report that futures denominated in Bitcoin and Ether Euro are already trading on the BitMEX exchange. “The daily volume for the contract on BitMEX is at its lowest this year,” the report added.
Source: Kaiko
BitMEX has also announced the launch of the first-ever crypto perpetual forex swap contracts. Kaiko said, “These FX swaps allow investors to trade the product 24/7 even when the traditional FX market is closed and could be another widely used product in the derivatives market.”
On September 12, CME will also introduce options on ether futures, which will be subject to regulatory review.
Looking for a new way to add the flexibility of options to your cryptocurrency portfolio? Meet CME Group’s Ether Options Launching September 12th. https://t.co/yHc3s6oL9h pic.twitter.com/wlKTGNyE5K
— CME Group (@CMEGroup) August 18, 2022
Sam Newman, Head of Brokering for Digital Assets at TP ICAP, said in a statement: “With the upcoming Ethereum protocol merger, we expect this new contract to generate significant interest from both our traditional and crypto-native customers becomes.”
volumes
In its findings, CME reported that the second quarter was a record for all cryptocurrency products with an average daily open interest (OI) of 106,200 contracts and also the second-highest quarter for an average daily volume of 57,400 contracts.
In the second quarter, ether futures reached a record volume averaging 6,600 contracts per day, up 27% from the first quarter. CME reported that ether futures ADV rose to 7,900 contracts in July and open interest was up 7% from June.
McCourt added that volume and open interest have increased across all of CME’s crypto contracts.
“Institutional interest has not been hampered by the decline in valuations amid an increase in large OI holders,” he said. “CME has been a safe haven as volatility has led investors to want access to crypto through regulated venues and products.”
CryptoCompare’s Exchange Review for July says spot trading volume across all centralized crypto exchanges fell 1.3% to $1.4 trillion, the lowest monthly trading volume since December 2020.
Source: CryptoCompare
However, derivatives trading volume rose 13.4% to $3.1 trillion for the first time since March, which CryptoCompare says indicates an uptick in speculative activity as traders believe there is room for further upside in this rally , and traders speculated on the impact of Ethereum merger.
In July, CME’s ether and bitcoin futures volume fell 9.9% to a total of $36.5 billion, according to CryptoCompare. According to the report, “235,730 bitcoin futures contracts were traded in July, down 7.11% since June. This was the first recorded drop in the number of bitcoin futures contracts traded on the CME in four months.”
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