CBOE exchange to launch Ethereum futures trading by year’s end
The Chicago Board Options Exchange (CBOE) is looking to add Ethereum (ETH) futures trading to its platform. It already began offering Bitcoin (BTC) futures last December and is ready to go with ETH as soon as it clears one remaining hurdle. It needs the go-ahead from the Commodities Futures Trading Commission (CFTC).
The CBOE, through its parent company, CBOE Global Markets, expects to be able to offer ETH futures contracts by the end of this year. The contracts will be based on the Gemini exchange, run by the Winklevoss brothers, the same way it offers the BTC futures contracts.
A future is a type of agreement through which an asset is agreed to be bought or sold for a specific price on a specific date. It allows investors to speculate on the price of the asset without having to hold it. They are used for both physical, as well as financial, assets.
In June, the US Securities and Exchange Commission (SEC) determined that ETH is not a security, which has paved the way for futures contracts to be traded. Chris Concannon, CBOE Global Markets president, said at the time, “This announcement clears a key stumbling block for Ether futures, the case for which we’ve been considering since we launched the first Bitcoin futures in December 2017.”
The Chicago Mercantile Exchange (CME) began offering BTC futures at almost the same time as did the CBOE. It reported last month that the second-quarter average daily volume for the contracts had increased by 93% over the first quarter and added that the number of open BTC futures contracts topped 2,400 during the same period – an increase of 58% over the previous quarter.
Unlike the CBOE, however, the CME exchange doesn’t believe it will offer anything other than BTC futures contracts. A statement by the company’s CEO, Terry Duffy, last month asserted that the market volatility is a deterrent to stepping deeper into cryptocurrency futures trading.