CME Group has revealed that it will launch Bitcoin options for is futures contracts within the next two months.
Announcing the development in a press release today, the leading derivatives exchange operator stated that pending the necessary regulatory approval, it would launch its options on bitcoin futures on January 13, 2020.
CME Group noted that the need to launch an option contract for bitcoin futures became imperative based on series of users’ requests and robust growth of its Bitcoin futures market, which prompted the exchange to provide users with additional flexibility to trade and hedge their Bitcoin price risk.
“Since the launch of our Bitcoin futures nearly two years ago, clients have expressed a growing interest in options as another way to hedge and trade in these markets,” said Tim McCourt, CME Group Global Head of Equity Index and Alternative Investment Products.
McCourt further explained that the exchange has worked with major players of the crypto industry since the launch of its Bitcoin futures, to help create a robust futures market for the firm.
Options contracts on bitcoin futures create an avenue for users to buy and sell specific futures contracts at an agreed price and expiration date.
The Chicago-based exchange believes the feat recorded so far for its Bitcoin futures can be replicated in its options contracts.
Per the press release, since December 2017, when the exchange’s Bitcoin futures were launched, CME Group has recorded an average daily volume of more than 6,500 so far in 2019, which is equivalent to 32,500 Bitcoin.
Similarly, the exchange has over 3,500 individual active accounts currently trading the product, with about 47 percent transaction being conducted from users living outside the U.S., the press release notes.
Meanwhile, Bakkt, the Intercontinental Exchange (ICE)-backed cryptocurrency exchange has also chosen December 9 to launch its ‘regulated’ option contract for Bitcoin futures, which will be based on the benchmark of the exchange’s Monthly Bitcoin futures contract.
