Financial services provider CBOE intends to launch cash-settled bitcoin futures based on the FTSE Russell Bitcoin Index on April 28.
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Cboe Global Markets gears up to unleash the Cboe FTSE Bitcoin Index futures, setting the launch date on April 29, 2025. The action unfolds on the Cboe Futures Exchange, subject to regulatory approval.
This move aims to empower traders to navigate their Bitcoin adventures with a more comprehensive arsenal of management tools.
Heavyweights Joining the Fray
The futures contracts shall see the light of day in partnership with FTSE Russell, a noteworthy index and benchmark pioneer, renowned for crafting innovative products in the digital asset realm.
The contracts draw their foundation from the FTSE Bitcoin Reduced Value (1/10th) Index (XBTF). In essence, these contracts track one-tenth of the value of the FTSE Bitcoin Index rather than mirroring its full price.
Such a contract size offers traders the opportunity to manage their Bitcoin exposure while skirted from the intense volatility plaguing the cryptocurrency's price swings.
These XBTF futures are cash-settled, implying that contracts will settle in cold, hard cash based on the index value at the contract's expiration. Settlement happens in the late afternoon (P.M.) on the final business day of every month.
The futures are tailored to coexist harmoniously with Cboe's recently debuted options on the Cboe Bitcoin U.S. ETF Index. CBOE believes these new contracts offer a valuable asset for market participants intent on implementing various trading and hedging strategies linked to Bitcoin's rollercoaster price ride.
Catherine Clay, Global Head of Derivatives at Cboe, voiced the exchange's primary objective: meeting the escalating demand for crypto exposure and offering capital-efficient and multifunctional tools.
This fresh product, according to Clay, fortifies Cboe's existing Bitcoin product ecosystem, which encompasses spot Bitcoin ETFs listed on their equities exchange and Bitcoin ETF index options.
Widening the Digital Asset Universe
Cboe has been branching out its offerings in the digital assets sector. The exchange has welcomed a slew of spot Bitcoin and Ether ETFs in cooperation with heavyweight fund managers like Franklin Templeton, VanEck, Fidelity, WisdomTree, ARK Invest, 21Shares, Invesco, and Galaxy Digital.
The upcoming launch represents part of Cboe's persistent efforts to broaden its digital asset portfolio, providing customers with more freedom and choice.
In addition to cash-settled index options linked to the spot Bitcoin price, Cboe also offers margined Bitcoin and Ether futures, which are currently traded on the Cboe Digital Exchange. These futures are slated to shift to the Cboe Futures Exchange (CFE) in the second quarter of 2025, pending regulatory approval.
The exchange yearns for the SEC's go-ahead to authorize options trading on four Ether ETFs, including Fidelity Ethereum Fund, Bitwise Ethereum ETF, Grayscale Ethereum Trust, and Grayscale Ethereum Mini Trust.
The SEC has acknowledged all the proposals but has postponed its decision on whether to accept them. The Fidelity Ethereum Fund options decision deadline falls in May this year.
Nasdaq ISE is also eyeing options on BlackRock's iShares Ethereum Trust (ETHA). The securities regulator has delayed the decision deadline for the proposed rule change, with the new deadline expected this month for the final ruling on this proposal.
Asset managers are diversifying their crypto ETF options to cater to customers' demands and needs. The current regulatory environment is particularly hospitable to achieving that.
Moreover, some firms have begun to wager on the SEC's leniency towards crypto regulations by submitting proposals to incorporate staking into their spot Ethereum ETF. This functionality was previously expunged from their original ETF pursuit due to the SEC's stance that staking is akin to securities.
[1] FTSE Russell (n.d.). FTSE indices, RFQ, and FTSE BINTAX methodology. Retrieved from https://www.ftserussell.com[2] Intercontinental Exchange Inc. (2022). ICE Markets: Cboe Futures Exchange. Retrieved from https://www.theice.com[3] Cboe Global Markets (n.d.). Cboe Bitcoin (USD) indices and products. Retrieved from https://www.cboe.com
- As Cboe Global Markets prepares to launch the Cboe FTSE Bitcoin Index futures on April 29, 2025, investors can now explore cryptocurrency finance more efficiently with a wider range of management tools, thanks to this new technology in partnership with FTSE Russell.
- Bitcoin and other cryptocurrencies may become more accessible to mainstream finance with the introduction of the XBTF futures, which offer traders the opportunity to manage their exposure to the cryptocurrency market without being overwhelmed by its volatility.
- With the forthcoming launch of the Cboe FTSE Bitcoin Index futures, as well as ongoing efforts to bring more Ether ETFs and options to market, asset managers are aiming to provide greater choice and flexibility to customers seeking to invest in the growing digital asset universe.
