The growth of bitcoin derivatives is another step toward the development of the digital currency as an established asset class.
CME, the global exchange for options and futures trading, will be offering derivatives for bitcoin, from the fourth quarter, pending regulatory review. The bitcoin futures contract will be cash-settled and based on the CME CF Bitcoin Reference Rate (BRR).
Terry Duffy, CME’s CEO, stated: “Given increasing client interest in the evolving cryptocurrency markets, we have decided to introduce a bitcoin futures contract”. Regarding the U.S. Commodity Futures Trading Commission’s application process, he added “We’ve been working with the regulator. They understand our application. And they understand our model very, very wel,”.
CME isn’t the first exchange to look into ETFs tracking bitcoin futures: 3 months ago, the Chicago Board Options Exchange announced it planned to offer cash-settled bitcoin futures by early 2018.