Cboe submits product certification for bitcoin futures

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The new contract will be available for trading on the CME Globex electronic trading platform effective on Sunday, December 17, 2017, for a trade date of December 18.

CME said on Friday it would list its bitcoin futures contract, which like CBOE's will be priced against and settled in the cash bitcoin market, on December 18.

The deal with the Commodities and Futures Trading Commission agency also enables Cantor Exchange to offer bitcoin options, another type of derivative contract, which allows for trading without taking ownership of an underlying asset. "We are operationally ready and we will be announcing a launch date shortly", the spokesperson said in the new statement.

Bitcoin traded more than 6 percent higher at $10,539 on Friday, recovering partly from a 20 percent drop to $9,021.85 from a record high of $11,377.33 hit Wednesday, according to CoinDesk.

The price of bitcoin futures will be based on the price the digital currency is going for on four major bitcoin exchanges - Bitstamp, GDAX, itBit and Kraken.

"We are pleased to bring Bitcoin futures to market after working closely with the CFTC and market participants to design a regulated offering that will provide investors with transparency, price discovery, and risk transfer capabilities", said Duffy.
CME and CBOE have also agreed to enter into information-sharing agreements and to send the CFTC data on the settlement process so the regulator can conduct its own surveillance.

The Commission says once the contracts are launched, the CFTC staff will engage in risk-monitoring activities. "Nevertheless, investors should be aware of the potentially high level of volatility and risk in trading these contracts", Giancarlo adds. Instead, they only have to file a written self-certification with the regulator. The product certification is subject to regulatory review.

CME has been vying with CBOE to introduce the first bitcoin-related financial product.

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