CME Group Rolls Out Micro Bitcoin Futures

The Chicago Mercantile Exchange (CME) has rolled out its latest Bitcoin (BTC) derivatives product, paving way for broader mainstream market to utilize cryptocurrencies. The exchange’s chief of equity index and alternative investment products, Tim McCourt, stated that the latest product will offer “an efficient, cost-effective way for a broad array of market participants — from institutions to sophisticated, active traders — to fine-tune their bitcoin exposure and enhance their trading strategies.”

The Micro Bitcoin futures contract has a value if 0.1 Bitcoin, empowering traders with yet another tool to mitigate their cryptocurrency price volatility risk. J. B. Mackenzie, managing director of TD Ameritrade Futures and Forex, opined that the offered Micro Bitcoin futures contract resolves two main problems related to cryptocurrency investing i.e., “the high cost and the desire to engage within a regulated environment.”

Highlighting rising demand for small sized contracts, CME Group initially revealed its plan to roll out a micro Bitcoin derivatives product on March 30. During that period, 1 Bitcoin was valued at about $58,000, almost $3,000 higher than the current price level. The numero uno crypto surged over $64,000 in early April before recording a sharp retracement.

The utilization of cryptocurrency derivatives has increased exponentially since CME rolled out the foremost Bitcoin futures agreement in December 2017. Even though the Chicago Board Option Exchange unveiled a similar product without any delay, it terminated the product offering soon. Notably, cryptocurrency derivatives trades represented 55% of the aggregate market cap in December 2020.

That figure will probably increase as derivatives exchanges such as FTX, Bybt and BitMEX remain the top platforms which attract traders looking for large exposure to cryptocurrencies.