CME Group, the world’s leading and most diverse derivatives marketplace, announced it will expand its suite of crypto derivatives with the introduction of a new Micro Bitcoin futures contract on May 3, pending regulatory review.
Micro Bitcoin futures will be one-tenth the size of one bitcoin. The smaller-sized contract will provide market participants – from institutions to sophisticated, active, individual traders – with one more tool to hedge their spot bitcoin price risk or execute bitcoin trading strategies in an efficient, cost-effective way, all while retaining the features and benefits of CME Group’s standard Bitcoin futures.
“Since the launch of our Bitcoin futures contract in 2017, we have seen steady, ongoing growth of liquidity and market participation in our crypto derivatives, especially among institutional traders,” said Tim McCourt, CME Group Global Head of Equity Index and Alternative Investment Products. “The introduction of Micro Bitcoin futures responds directly to demand for smaller-sized contracts from a broad array of clients and will offer even more choice and precision in how participants can trade regulated Bitcoin futures in a transparent and efficient manner at CME Group.”
Micro Bitcoin futures will join CME Group’s growing suite of cryptocurrency derivatives, including Bitcoin futures and options and recently launched Ether futures. In 2021-to-date, 13.8K CME Bitcoin futures contracts (equivalent to about 69K bitcoin) have traded on average each day. In addition, CME Ether futures have seen 767 contracts traded (equivalent to 38.4K ether) on average each day since launched on February 8.
The new contract will be cash-settled, based on the CME CF Bitcoin Reference Rate, which serves as a once-a-day reference rate of the U.S. dollar price of bitcoin. Micro Bitcoin futures will be listed on and subject to the rules of CME.