Three days before Ethereum’s transition from proof-of-work (PoW) to proof-of-stake (PoS), CME Group, the world’s most traded derivatives market, announced plans to list ethereum options. As CME’s ether options product prepares for regulatory scrutiny, the company detailed that options contracts will be measured at 50 ether per contract, using the CME CF ether dollar reference rate.
CME Group Announces Ethereum Options
Chicago Mercantile Exchange, also known as CME Group, revealed that the company intends to list ethereum options contracts three days before the merger on September 12, 2022. The new ethereum options join the firm’s bitcoin (BTC) options and micro bitcoin and ether options contracts, CME detailed.
“These new contracts deliver an ethereum future with a contract size of 50 ether each and are based on the CME CF ether dollar reference rate, which serves as a daily reference rate for the price of ether,” the derivatives market said on Thursday. The new ether options contract adds to the firm’s existing lineup of crypto derivatives, Tim McCourt, CME’s global head of equities and foreign exchange products, noted on Thursday.
“The launch of these new options contracts builds on the significant growth and deep liquidity we have seen in existing ether futures, with over 1.8 million contracts traded to date,” McCourt said in a statement . The CME Group executive added:
As we approach the highly anticipated Ethereum merger next month, we continue to see market participants turn to CME Group to manage Ethereum price risk. Our new Ether Options will provide our clients with greater flexibility and precision in managing their Ether exposure ahead of market-moving events.
CME Group will join a number of exchanges that already offer ethereum options contracts, including Deribit, Okex, Bit.com and Huobi. In July, Ethereum options volume was $11.38 billion, and Deribit’s volume was $10.86 billion across all four exchanges listing ETH options. Deribit also dominates ether options open interest market share when compared to open interest figures related to Huobi, Okex, and Bit.com.
In Bitcoin options, Deribit also outpaced CME, as CME Group ranked second in Bitcoin options open interest, recording $441 million on Aug. 17. Likewise, CME ranks third in Bitcoin options trading volume, with Deribit taking the lead. In the case of Bitcoin options, Okex managed to gain more volume.
With the new CME Ether Options, TP ICAP Digital Assets and Akuna Capital are supporting the launch of CME’s Ether Options. TP ICAP Digital Assets is delighted to support CME Group in the launch of its full-sized Ether options contract,” said Sam Newman, head of brokerage at TP ICAP, in the announcement. “TP ICAP’s clients are eagerly looking forward to this larger-sized Ether option and the Combined with the already popular Micro Ether option. “
What do you think of CME Group offering Ethereum options on September 12, 2022? Let us know what you think about this topic in the comments section below.
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