CME Options on Bitcoin Futures Are Live
The Chicago Mercantile Exchange (CME Group) this Monday announced the start of trading in the Bitcoin options market. CME options on Bitcoin futures (BTC) are now live.
The asset of the new CME option is a Bitcoin futures contract launched by the same exchange at the end of 2017. One contract corresponds to five bitcoins and undergoes centralized clearing on the trading platform, which avoids counterparty risks. To determine the Bitcoin exchange rate, CME uses the data of several cryptocurrency exchanges.
According to the analytic firm Skew, Bitcoin options have been in high demand since the beginning of the year — by Friday the value of the trading volume exceeded $90 million. About 95% of transactions in Bitcoin options last year were on the Deribit derivative exchange. They recently announced that they will relocate the platform operator from the Netherlands to Panama. The reason was the entry into force of the Fifth EU Directive on combating money laundering.
On Sunday, the launch of its own Bitcoin options was also announced by the FTX trading platform. Two hours after the announcement, the CEO of the company announced the achievement of a trading volume of $1 million. Earlier, FTX received support from the cryptocurrency exchange Binance.
In anticipation of the opening of CME’s Bitcoin options trading, JPMorgan Chase & Co strategist Nikolaos Panigirtzoglou noted a growing interest in cryptocurrency derivatives among institutional investors.
Author: Marko Vidrih
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