CME Group to Offer Market Participants Ethereum Options on September 9, 2022

Jamal Molla
Written By Jamal Molla
Jamal is an English teacher and freelance writer with a passion for NFTs, metaverse, crypto and technology.

The Chicago Mercantile Exchange (CME Group) has announced its plan to include Ethereum options contracts on September 9, before The Merge on September 12, 2022. CME Group to offer market participants Ethereum options to add to its other products. According to the company, the new Ethereum option contracts will be part of the company’s bitcoin options.

Tim McCourt, Head of equity and FX products for CME Group on Thursday said, “These new contracts deliver one ether futures, sized at 50 ether per contract, and based on the CME CF Ether-Dollar Reference Rate, which serves as a once-a-day reference rate of the U.S. dollar price of ether.”

The addition of Ethereum options contracts will be part of the several cryptocurrency derivative products it offers to traders. McCourt added, “The launch of these new options contracts builds on the significant growth and deep liquidity we have seen in our existing Ether futures, which have traded more than 1.8 million contracts to date.”

The CME Group executive added that as the forthcoming Ethereum Merge in September comes up, they would monitor how investors will look to CME Group to manage their Ethereum price risk. The introduction of the Ethereum options contracts will provide several investors flexibility and precision to manage their Ethereum exposure in real time. However, Ethereum is neither decentralized nor deflationary despite rising prices.

This will make CME Group part of the several exchanges already offering investors Ethereum options contracts. These exchanges include Huobi, Okex, Beribit, and Bit.com. Among these four exchanges, Deribit had a larger volume share in July, totaling $10.86 billion of the $11.38 billion volume. Compared to other Ethereum Options contracts exchanges, Deribit dominates the market shares.

Furthermore, Deribit is also top CME in bitcoin options. However, CME Group remains the second largest bitcoin options open interest, with a record of $441 million on August 17. Regarding bitcoin options volume, CME is the third largest, with Deribit the first among these exchanges. As far as bitcoin options is concerned, Okex can draw in a little larger volume of trades.

Akuna Capital and TP ICAP Digital Assets are helping CME Groups roll out its Ether options. Sam Newman, TP ICAP’s head of broker, said, “This larger-sized Ether option, in tandem with the already popular Micro Ether option, has been eagerly awaited by TP ICAP’s customers.”

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