CME Group to Launch Ethereum Futures in February Pending Regulatory Approval

On December 16, the Chicago Mercantile Exchange (CME) announced that CME Group is expanding the company’s crypto derivatives and plans to launch Ethereum futures. The company said the launch is based on increasing client demand and aims to launch the new ether derivatives products on February 8, 2021.

While bitcoin (BTC) has touched a new all-time price high, the second-largest crypto market held by ethereum (ETH) has also gained a lot of momentum. On Wednesday, December 16, 2020, ether prices jumped to $625 per unit and captured a market valuation of around $71 billion. Meanwhile, on the same day, CME Group announced the launch of a cash-settled futures market for ethereum.

“The new contract will be cash-settled, based on the CME CF Ether-Dollar Reference Rate, which serves as a once-a-day reference rate of the U.S. dollar price of ether,” explained the company’s press release on Wednesday. “Ether futures will be listed on and subject to the rules of CME.”

CME Group announced the new ether futures as CME Bitcoin futures products will celebrate their third anniversary on December 17. “Based on increasing client demand and robust growth in our bitcoin futures and options markets, we believe the addition of ether futures will provide our clients with a valuable tool to trade and hedge this growing cryptocurrency,” said Tim McCourt, CME Group Global Head of Equity Index and Alternative Investment Products.

McCourt further added:

Ethereum is the second-largest cryptocurrency by both market capitalization and daily volume. The introduction of listed ether futures to our time-tested, regulated CME Group derivatives marketplace will help to create a forward curve so ethereum market participants can better manage price risk.

Of course, the February 8, 2021 ether futures launch from CME Group is pending on approval from U.S. financial regulators. Ethereum proponent Ryan Sean Adams was thrilled to hear the news and tweeted about it to his 38,000 Twitter followers.

“ETH futures on the CME,” Adams said. “[The] floodgates are open. The largest derivatives exchange in the world just announced ETH futures on Feb 8. The world’s largest institutions will have a regulated way to buy ETH just in time for the bull run. Next is all-time high. Then we slay 10k,” Adams added.

People new to the crypto-space will not remember that the previous bull market began when the CME announced a Bitcoin futures product,” explained another ETH supporter Tyler Smith. “Today, the CME just announced an ethereum futures product. What do you think is going to happen?” Smith asked his Twitter followers.