CME Group, the world's leading derivatives marketplace, announced on August 4th, 2022 that it will expand its selection of derivatives products by launching a Euro-denominated Bitcoin futures product. The company will also be releasing Euro-denominated Ether futures that same day.
Developed to match their U.S. dollar-denominated equivalents, Bitcoin Euro futures contracts will have a contract size of five Bitcoins. These new contracts will be cash-settled and based on the CME CF Bitcoin-Euro Reference Rate, which are daily reference rates for the price of Bitcoin expressed in euros. These new futures contracts will be listed on the CME and subject to the company’s rules.
Global Head of Equity and FX Products Tim McCourt explains in CME’s statement that institutional investors outside of the U.S. are becoming more interested in risk management solutions as a result of the persistent uncertainty in the Bitcoin and cryptocurrency markets. He adds that CME’s Euro-based futures contracts for Bitcoin and other cryptocurrencies will give customers more accurate instruments for trading and hedging exposure to the digital market.
“Euro-denominated cryptocurrencies are the second highest traded fiat behind the U.S. dollar. Year-to-date, the EMEA region represents 28% of total Bitcoin and Ether futures contracts traded, up more than 5% versus 2021,” says McCourt.
Edmond Goh, Head of Trading at B2C2 praises the liquidity that CME will soon provide for the futures market. He states that “The launch of euro-denominated Bitcoin and Ether futures from CME Group will help meet the growing demand for regulated and robust, non-USD crypto derivatives.”
Sam Newman, Digital Assets Head of Brokering at TP ICAP, shares the same sentiment by explaining, “Interest in cryptoassets has seen huge growth, and these new euro-denominated futures contracts will help further expand the accessibility and utility of cryptoasset derivatives, particularly within Europe.”
CME Group's Bitcoin and cryptocurrency product suite aims to deliver continuous liquidity, volume, and open interest for customers looking to hedge their risk or gain exposure to this growing market. In terms of average daily open interest (106.2K contracts), Q2 set a record quarter while being the second-highest quarter in terms of average daily volume (57.4K contracts) for all of CME’s Bitcoin and cryptocurrency products.