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HomeCrypto NewsMarketCME Group Introduces Financially-Settled Options on Bitcoin Friday Futures

CME Group Introduces Financially-Settled Options on Bitcoin Friday Futures

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CME Group has announced plans to introduce financially settled options on its Bitcoin Friday futures starting February 24, subject to regulatory approval. 

These new contracts will be the first of their kind within CME’s crypto product lineup, featuring expiration dates every business day from Monday through Friday. The move aims to provide market participants additional flexibility in managing Bitcoin price exposure and refining their trading strategies.

CME Group Bitcon annoucement
CME Group Bitcon annoucement

Newly Introduced Options 

With the addition of financially settled options, CME Group expands its existing range of cryptocurrency derivatives. The current offerings include physically settled options on Bitcoin, Micro Bitcoin, Ethereum, and Micro ETH futures. These new contracts are expected to complement the firm’s growing suite of digital asset offerings. 

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Bitcoin Friday futures have already gained significant traction in the market. Since launch, the product has recorded over 775,000 contracts traded. The average daily volume has reached 9,700 contracts. A notable 44% of trading activity occurs outside U.S. market hours, reflecting global demand for the futures contract.

In CME’s blog, Jason Urban, Global Head of Trading at Galaxy, said:

“As a major liquidity provider in the digital asset derivatives space, we see CME Group’s introduction of options on Bitcoin Friday futures as a timely, important addition to the market.”

Access Through Mini Bitcoin Futures

In August last year, CME Group introduced the mini-Bitcoin futures contract, known as Bitcoin Friday Futures (BFF), to cater to retail investors. These contracts became officially available for trading on September 30 after receiving regulatory clearance. They were designed to lower entry barriers by pricing each contract at a fiftieth of a quarter of one Bitcoin.

Notably, the weekly contracts follow a cash settlement process, referencing the CME CF Bitcoin Reference Rate New York Variant (BBRNY). The settlement price is determined every Friday at the end of the New York trading session. This process helps mitigate investors’ exposure to potential weekend price swings in the Bitcoin market.

Potential Expansion into XRP and SOL Futures

Meanwhile, recent updates on a beta version of CME Group’s website suggest that the exchange is preparing to introduce futures contracts for Solana (SOL) and XRP. However, these futures contracts are pending regulatory approval. 

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These futures contracts were scheduled for release on February 10, though CME has yet to confirm the official launch. If approved, these new offerings would align with the broader push for more regulated crypto investment products in the U.S.

Meanwhile, demand for crypto exchange-traded funds (ETFs) continues to rise, with new filings indicating the potential launch of multiple XRP and SOL ETFs.

DisClamier: This content is informational and should not be considered financial advice. The views expressed in this article may include the author's personal opinions and do not reflect The Crypto Basic opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.

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