CME Group is gearing up to add a new futures contract to its portfolio.
The Chicago Mercantile Exchange (CME) Group has unveiled plans to launch a new futures contract based on the ratio between Ether (ETH) and Bitcoin (BTC).
On June 29th, CME Group revealed that its Ether to Bitcoin Ratio futures is set to be released around the end of July, provided it receives the necessary regulatory approval.
Did you know?
Want to get smarter & wealthier with crypto?
Subscribe - We publish new crypto explainer videos every week!
What is a Crypto Bridge? (Explained with Animations)
In the announcement, the company clarified that the new contracts would be settled in cash, and their calculation would derive from the final settlement price of CME Group's Ether futures divided by the price of their Bitcoin futures.
It was also revealed that the new futures contract would maintain the same listing cycle as the existing Bitcoin and Ether futures contracts of the CME Group.
Giovanni Vicioso, CME Group's head of global cryptocurrency products, brought attention to the potential for relative value trading opportunities presented by the Ether and Bitcoin pairing.
Vicioso articulated that while these assets have historically shown high correlation, changes in their market dynamics might make it possible to benefit from the differences in their performances. He further elaborated:
With the addition of Ether/Bitcoin Ratio futures, investors will be able to capture Ether and bitcoin exposure in a single trade, without needing to take a directional view. This new contract will help create opportunities for a broad array of clients looking to hedge positions or execute other trading strategies, all in an efficient, cost-effective manner.
CME Group has been an active player in the crypto market, initially stepping in by launching the first Bitcoin futures contract in December 2017. Subsequently, the company introduced an Ether futures contract in February 2021. This entrance into the digital asset market was fueled by increasing demand from investors for cryptocurrency opportunities.
In 2022, the firm bolstered its cryptocurrency offerings with the launch of micro BTC and ETH futures contracts, thus offering traders an expanded spectrum of options to invest in these digital assets.
The CME Group's upcoming introduction of Ether/Bitcoin Ratio futures underscores its ongoing commitment to enhancing its cryptocurrency offerings and providing traders with diverse investment options in the volatile digital asset market.
