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Chicago Mercantile Exchange (CME) Group, a United States futures exchange, is launching bite-sized Bitcoin Friday futures (BFF) amid mounting interest in cryptocurrency futures among retail investors, according to an Aug. 27 announcement by CME.&nbsp;
<a href="https://www.prnewswire.com/news-releases/cme-group-to-launch-bitcoin-friday-futures-on-september-30-302231371.html" rel="noopener noreferrer nofollow" target="_blank">Launching</a> Sept. 30, BFFs will be sized at only one-50th of a Bitcoin (<a href="https://cointelegraph.com/bitcoin-price" rel="noopener noreferrer nofollow" target="_self">BTC</a>). That is substantially smaller than rival retail-oriented Bitcoin futures products, such as Coinbase’s “nano” Bitcoin futures, sold in increments of one-100th of 1 BTC.&nbsp;
The contracts will be cash-settled every Friday against the CME CF Bitcoin Reference Rate New York Variant (BRRNY), a benchmark for BTC’s spot price.&nbsp;
Related: <a href="https://cointelegraph.com/news/stop-piling-leveraged-bitcoin-etfs-consider-this-instead" rel="noopener noreferrer nofollow" target="null">Stop piling into leveraged Bitcoin ETFs and consider this instead</a>
“With these weekly expiring smaller-sized contracts, investors of all sizes - from institutions to sophisticated, active retail traders - will be able to more accurately fine-tune their Bitcoin exposure on a regulated exchange,” said Giovanni Vicioso, CME Group’s global head of cryptocurrency products, in a statement.&nbsp;
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 BTC futures are surging in popularity. Source: CME Group
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Bitcoin futures are surging in popularity in the US, with open interest on CME BTC futures contracts nearing 30,000 contracts as of Aug. 20, according to <a href="https://www.cftc.gov/dea/futures/deacmesf.htm" rel="noopener noreferrer nofollow" target="_blank">data</a> from the US Commodity Futures Trading Commission. Each CME Bitcoin futures is sized at 5 BTC.&nbsp;
CME faces competition from rivals such as Coinbase Derivatives, which offers futures contracts for Bitcoin, Ether (<a href="https://cointelegraph.com/ethereum-price" rel="noopener noreferrer nofollow" target="_self">ETH</a>) and alternative cryptocurrencies, such as Litecoin (<a href="https://cointelegraph.com/ltc-price-index" rel="noopener noreferrer nofollow" target="_self">LTC</a>) and Dogecoin (<a href="https://cointelegraph.com/doge-price-index" rel="noopener noreferrer nofollow" target="_self">DOGE</a>).&nbsp;
Futures contracts are standardized agreements to buy or sell an underlying asset at a future date. They play a critical role in hedging strategies for institutional investors. Futures are also popular for speculation because they allow traders to double down on directional bets with leverage.&nbsp;
“With its smaller notional size and weekly Friday expiry, Bitcoin Friday futures will allow our global traders a cost-efficient way to gain exposure to Bitcoin, as well as effectively manage their existing product portfolios and capture new trading strategies,” said Tanmay Sheth, director of futures at Webull — a retail-oriented electronic trading platform — in a statement.
Other types of cryptocurrency derivatives, such as options, are <a href="https://cointelegraph.com/news/expect-bitcoin-etf-options-launch-before-2025" rel="noopener noreferrer nofollow" target="_self">expected to launch on US exchanges</a> soon.
Magazine: <a href="https://cointelegraph.com/magazine/musk-empire-exchange-listing-sandbox-web3-gamer/" rel="noopener noreferrer nofollow" target="null">When Musk Empire listing? Find love in The Sandbox and more: Web3 Gamer</a>

CME to launch bite-sized Bitcoin ‘Friday’ futures in bid for retail

Cointelegraph

Other articles published on Aug 27, 2024

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