CME Group to offer Ether/Bitcoin ratio futures in July

CME Group, a major derivatives trading platform, said on June 29 that it will launch Ether/Bitcoin ratio futures this summer, pending regulatory approval.

CME Group said that it plans to launch its BTC/ETH ratio futures product on July 31, 2023.

A ratio futures contract is a type of futures contract where the underlying asset is a ratio of two commodities. This type of contract allows traders to speculate on the relative price movement of two different commodities. The contract is settled in cash based on the difference between the contract price and the spot price of the ratio at the time of settlement.

The company otherwise expanded its assortment of Bitcoin and Ethereum futures in early 2023. That expansion was announced in April and took place in May.

Industry members comment on offering

Giovanni Vicioso, CME Group Global Head of Cryptocurrency Products, said:

“With the addition of Ether/Bitcoin Ratio futures, investors will be able to capture Ether and Bitcoin exposure in a single trade, without needing to take a directional view.”

He noted that Bitcoin and Ethereum prices have been “highly correlated” in the past, but that growth has led each asset to perform independently at times.

Jason Urban, Global Head of Trading at Galaxy Digital, added that the investment will increase investment opportunities for institutions and “sophisticated investors.” He did not indicate whether retail users will be able to invest in the fund.

Paul Eisma, Head of Options Trading at XBTO, suggested that the fund could have a positive impact on some markets by increasing volumes and reducing spreads.

Meanwhile, Brooks Dudley of Marex Capital Markets called the offering an “important advancement for CFTC-regulated cryptocurrency derivatives.”

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