CME Group introduces micro-bitcoin and ether options

CME Group introduces micro-bitcoin and ether options

The CME Group's appointment exchange will introduce options for micro-bitcoin and ether futures to give more retailers access to such instruments with nominal capital.

The option contracts that are to be introduced on March 28 will be a tenth of the size of their underlying tokens. CME introduced Bitcoin futures contracts with a size of five Bitcoin in 2020.

futures require that the buyer buys an asset at a certain point in time, while options give an investor the right, but not the obligation to buy or sell an asset before the contract has expired.

The CME Group started in 2017 with the offer of Bitcoin futures contracts and last year introduced micro-bitcoin futures contracts with cash compensation worth a tenth of a bitcoin. The derivative market in November started adding micro ther futures, since the liquidity in ether futures increases steadily with investors.

About 5.2 million micro-bitcoin and micro ether-futures contracts, according to Tim McCourt, Global Head of Equity and Foreign Exchange Products at the CME Group, changed hands in less than a year.

"Building on the strength and liquidity of the underlying contracts, our options in micrograsses will enable traders of all size to effectively secure market -moving events with greater precision and flexibility or to optimize their commitment on the cryptocurrency market," McCourt to Blockworks in an email.

Since retailers prefer short-term options to manage risks, market launch, according to McCourt, will include weekly expiry times for micro-crypto options on Monday, Wednesday and Friday.

Managers of Genesis Global Trading, Cumberland and Akuna Digital Assets said that their companies will provide liquidity.

"We believe that options on these contracts will enable more flexibility in the search for a cost -efficient commitment and open the market for new participants who prefer more granular dimensioning," said John Harris, CEO of Akuna, in one explanation.

The introduction takes place after the CME Group introduced two new reference courses for Bitcoin and Ether on Monday, which deliver a daily reference course of the US dollar price of the two digital assets that will be published at 4:00 p.m.

"We are constantly talking to customers and market participants and listening to you to find new ways to help you deal with cryptocurrency risks," said McCourt, declining to share certain future crypto products where the company is working.

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The Post-CME group for the introduction of Micro Bitcoin, Ether options is not a financial advice.