Later this month, the Chicago Mercantile Group will roll out options trading to its micro Bitcoin and Ether futures contracts.
In an announcement on March 1, the CME stated that by March 28 this year, pending regulatory review and approval. According to a statement by the firm, these future contracts will be one-tenth of the value of the respective underlying cryptocurrency.
“Building on the strength and liquidity of the underlying contracts, our micro-sized options will enable traders of all sizes to effectively hedge risk, and fine-tune their positions in the cryptocurrency market with greater precision and flexibility,” said Tim McCourt, Chief Equity Officer, and currency products of the CME group.
These options will be offered to many market participants, from institutions to active, sophisticated, and individual traders, to manage their exposure to the two largest cryptocurrencies by market cap.
These options are coming to provide the targeted risk exposure that investors are looking for and to deliver liquidity on the broad and growing family of CME Group cryptocurrency products.
Options will give the trader the right to buy or sell an asset at a specified rate at any time during the life of the contract. Futures contracts provide the buyer an obligation to purchase an asset on a specified date if the position is not closed in advance.
Recall that, according to data published by the CME group, for the third quarter of 2021, the average daily trading activity in Bitcoin futures increased by 170% compared to the previous quarter.