Summary: The Chicago Mercantile Exchange Group’s director of equity and cryptocurrency, Payal Shah, said they are “looking at” creating altcoin futures contracts given significant client requests as part of a panel discussion at CryptoCompare’s Digital Asset Summit in London on Wednesday. Shah acknowledged that the CME Group is considering adding more futures contracts because of clients ...
The Chicago Mercantile Exchange Group’s director of equity and cryptocurrency, Payal Shah, said they are “looking at” creating altcoin futures contracts given significant client requests as part of a panel discussion at CryptoCompare’s Digital Asset Summit in London on Wednesday.
However, Shah also explained that when it comes to creating more futures they face two main problems: indexes and regulations.
“The way that we’ve structured it, is to use a number of constituent exchanges so we have five exchanges that provide the price,” she said when talking about the indexes for Bitcoin and Ehtereum. “And the reason really is that if there is any outage on any one we still have a very precise price that we can settle our futures to.”
In terms of the other coins, they need an index to accomplish the same thing they are doing with the two major coins, or at the very least, they need to create their own.
In terms of regulations, they need to know where to send the paperwork. “Do we send it to the CFTC? Do we send it to the SEC?” she asked.
Really, they are looking for regulatory certainty. They want to know who they need to report to in regards to altcoins.
The U.S. Securities and Exchange Commission (SEC) has deemed only the big two coins to be non-securities and that all other coins are considered securities.
Since the launch of Bitcoin futures in December 2017, the CME has released options and futures contracts for Ether. In March of this year, the CME Group launched micro bitcoin and ether options which are a 10th of a standard token, making it more accessible to more people. Shah also spoke on that at the summit saying they are off to a good start.
Furthermore she said that in regards to just the micro Bitcoin contracts, they have done over 5 million contracts since their inception in May, 2021.
Author: Tyler Irvin