Tuesday, July 7, 2020

CME Group is not planning on issuing physically-settled BTC futures contracts

The Takeaway:

Derivative exchange giant CME Group has no plans to issue physically settled BTC futures contracts. Earlier the company had announced to introduce a bitcoin option in its futures contracts. CME launched its cash-settled futures contract services in 2017 during the peak of BTC.

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CME Group has revealed that they have no current plans to offer physically-settled bitcoin futures contracts. CME earlier announced that they are going to launch bitcoin options contracts in Q1 of 2020. The company believes that there is an increase in demand in the bitcoin futures market. 

In an interview with Markets Media, Tim McCourt, global head of equity index and alternative investment products at CME told that since the launch of bitcoin futures in 2017, the number one demand from customers has been for option on the futures. He further added that the institutional interest in bitcoin is growing, but they need time to become familiar with the market. 

Earlier last week Bakkt launched it’s physically settled BTC futures contracts, but the trading volume has been very slim so far. The slow start by Bakkt has surprised the crypto community as many had expected the launch to boost the BTC market. Just one day after Bakkt’s launch price of BTC crashed by 13%. It was the largest intraday hit since January. 

CME Group’s first-day volume was 5298 BTC, in comparison to 71 of Bakkt. Let us know in comments what do you think about the demand for BTC among institutes and CME exchange?

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Disclaimer: The article reflects the opinions of the author and is not representative of Chaintimes’ views.
The article does not offer any investment advice. User discretion is advised when investing in or trading with cryptocurrency. Extensive and diligent research should be carried out by the reader before making a decision.

William Botello
William Botello
William is a market research coordinator who believes that blockchain technology and cryptocurrencies can revolutionize the financial landscape. He completed his studies in Arts and Sciences from Arizona State University.

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