The largest stock exchange of financial derivatives – Chicago-based CME Group – confirmed the launch date for Bitcoin futures. Traders will have access to the new financial instrument on Monday, December 18. Information about this was published on the company's website.
“We are pleased that we had the opportunity to bring the Bitcoin futures to the market after the joint study of this issue with the Commodity Futures Trading Commission (CFTC) and other market participants,” said the head of CME Group, Terry Duffy. He noted that the process of developing the tool was delayed, which is due to the novelty and underdevelopment of the cryptocurrency market.
The new contracts will be launched on a cash settlement basis and will be based on the CME CF Bitcoin Reference Rate (BRR), the reference rate of BTC against the US dollar compiled by the CME Group from exchanges like Bitstamp, GDAX, itBit, and Kraken.
Warranty provision of futures contracts will be 35%, which is quite a high value for this kind of instruments. Also, the CME Group uses mechanisms to reduce the risks associated with volatility, including using intraday restrictions on price fluctuations.
According to Duffy, Bitcoin futures will help reduce the range of fluctuations in Bitcoin price for two reasons: firstly, they will not trade more than 20% higher or lower than the previous day's price, and secondly, traders will need to use collateral at a rate of 30% if they want to trade these instruments.
According to the laws of the United States, CME Group has the right to run such tools without an agreement with the regulator. To do this, it is sufficient to notify the CFTC that the contracts comply with the established rules.
The launch of Bitcoin futures was announced in late October, but the exact date was not called. This news caused a Bitcoin rally. However, traders feared that if the launch of futures will be canceled or postponed, a market collapse may occur.
At the time of writing the news, BTC price on the Bitfinex exchange grew by 8% to $ 10740.