CME to launch BTC/EUR and ETH/EUR futures amid ‘crypto winter’

Rick Steves

CME Group has announced its derivatives marketplace will add Bitcoin Euro and Ether Euro futures on August 29, pending regulatory review.

Bitcoin in a few hands

The expanded cryptocurrency derivatives offering aims to provide consistent liquidity, volume, and open interest for clients seeking to hedge their risk or gain exposure to the asset class.

Despite, or better yet, because of what’s been dubbed “crypto winter”, CME Group reported that Q2 2022 was a record quarter in terms of average daily open interest (106.2K contracts) and was the second highest quarter ever in terms of average daily volume (57.4K contracts) across all Cryptocurrency products. In addition, Ether futures achieved a record average daily volume of 6.6K contracts in Q2, up more than 27% versus Q1.

‘Crypto winter’ leads to more demand for risk management

Bitcoin Euro and Ether Euro futures contracts are designed to match their U.S. dollar-denominated counterparts and will be sized at five bitcoin and 50 ether per contract.

Cash-settled based on the CME CF Bitcoin-Euro Reference Rate and CME CF Ether-Euro Reference Rate, the upcoming crypto derivatives will be listed on and subject to the rules of CME.

Tim McCourt, Global Head of Equity and FX Products, CME Group, said: “Ongoing uncertainty in cryptocurrency markets, along with the robust growth and deep liquidity of our existing Bitcoin and Ether futures, is creating increased demand for risk management solutions by institutional investors outside the U.S. Our Bitcoin Euro and Ether Euro futures contracts will provide clients with more precise tools to trade and hedge exposure to the two largest cryptocurrencies by market cap. Euro-denominated cryptocurrencies are the second highest traded fiat behind the U.S. dollar. Year-to-date, the EMEA region represents 28% of total Bitcoin and Ether futures contracts traded, up more than 5% versus 2021.”

Edmond Goh, Head of Trading at B2C2, commented: “The launch of euro-denominated Bitcoin and Ether futures from CME Group will help meet the growing demand for regulated and robust, non-USD crypto derivatives. As the premier OTC counterparty, we look forward to continuing to provide liquid markets in this important asset class.”

Sam Newman, Digital Assets Head of Brokering at TP ICAP, added: “TP ICAP is excited to support another market-defining cryptoasset product from CME Group. Our Digital Assets business has been operational and brokering CME Group cryptoassets since the start of 2020, originally in London, followed by expansion to the U.S. in 2021 and, most recently, in APAC via Hong Kong and Singapore. Interest in cryptoassets has seen huge growth, and these new euro-denominated futures contracts will help further expand the accessibility and utility of cryptoasset derivatives, particularly within Europe.”

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