The Chicago Mercantile Exchange Group (CME), the largest derivatives exchange globally, is set to enhance its cryptocurrency offerings by launching options on Solana and XRP futures starting October 13.
This initiative follows record trading volumes in Solana (SOL) and XRP (XRP) futures contracts since their introductions earlier this year, as stated by the exchange. This is also the first instance where CME has expanded its options beyond Bitcoin (BTC) and Ether (ETH).
Futures are agreements to purchase or sell an asset at a predetermined price on a specified future date, while options provide traders the right, but not the obligation, to buy or sell those futures at fixed prices.
The options contracts will encompass both standard and micro-sized SOL and XRP futures, with daily, monthly, and quarterly expirations. These new derivative products await regulatory approval.
Giovanni Vicioso, CME’s global head of cryptocurrency products, remarked that this expansion signifies “significant growth and increasing liquidity” in the crypto futures markets. He anticipates that these products will cater to “institutions as well as knowledgeable, active individual traders.”
As per Wednesday’s notification, over 540,000 SOL futures contracts ($22.3 billion in notional value) have been traded since their launch in March, with August achieving record activity of 9,000 contracts daily.
XRP futures have also seen an increase in activity since their launch in May, with more than 370,000 contracts ($16.2 billion in notional value) traded and record open interest of $942 million observed in August.
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The first regulated crypto derivatives in the United States debuted in December 2017, with the Chicago Board Options Exchange (Cboe) and the CME Group launching Bitcoin futures under the oversight of the Commodity Futures Trading Commission (CFTC).
A significant milestone was reached in 2021 when CME introduced Ether futures, followed by a series of micro contracts sized at 0.1 ETH. Until recently, however, regulated crypto derivatives in the US were primarily restricted to Bitcoin and Ether.
With regulatory clarity from initiatives like the GENIUS Act and a pro-crypto administration, the demand for regulated crypto derivative products has been steadily increasing.
This demand has been addressed by traditional exchanges alongside US-based fintech companies and crypto platforms.
In February, Coinbase launched Solana (SOL) futures contracts in the US, including standard and “nano” contract sizes. The exchange later revealed its acquisition of the options exchange Deribit.
Crypto exchange Kraken introduced its derivatives branch in the country in July, while Robinhood released micro futures contracts for Bitcoin, Solana, and XRP via its derivatives arm.
The surge in regulated offerings in the US occurs as global crypto derivatives open interest hovers around $4 billion, according to CoinMarketCap.
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