It was recently known that the largest regulated market in the United States is evaluating cryptocurrency operators. Its about Chicago Mercantile Exchange (CME), dedicated to Bitcoin futures, which is now interested in a list of options for ETH.
In this sense, the CoinDesk portal published, that the firm QCP Capital, would have received an order from the CME to trade ETH derivatives. The founder and director of this Singapore-based company himself would have said this to the aforementioned media.
Although, there is no official statement from the CME, the information was leaked by some cryptocurrency traders. In addition, the possibility of its accuracy is expanded when taking into account that the CME is one of the favorite places of institutional investors who want to bet on Bitcoin.
CME wants to work with cryptocurrency traders
The fact that the CME is evaluating the possibility of opening a list of derivatives of the cryptocurrency of Ethereum (ETH), is not a surprise. ETH should be considered as the second largest digital currency in market capitalization, second only to Bitcoin in that area.
For this reason, the aforementioned entity is “on the lookout” for cryptocurrency operators. In the same way as he would have contacted QCP CapitalIf the statement of its founder and director, Darius Sit a CoinDesk, is taken for granted, he would be doing it with other companies to invest in ETH derivatives on the stock market.
It should be noted, as stated above, that the CME is one of the favorite places for high-end cryptocurrency-related investments. It should be remembered that, in 2017, the list of Bitcoin futures was opened and at the beginning of this 2020 the list of options was opened.
Why the CME rush to trade Ether?
As there is clear evidence, the strength of Ether as the second most important digital currency in capitalization is not new. So, you might ask, why is the CME interested in opening a list of ETH derivatives now and not at another time?
It is not known exactly how many cryptocurrency traders have been contacted by the CME to trade with ETH. However, if it can be predicted with a certain range of accuracy, the motivation for them to be invited to such operations: the boom of Decentralized Finance (DeFi).
During 2020, the growth of DeFi has been exponential. The enormous variety of options and advantages that these have compared to traditional finance, makes many investors pay attention to them, especially those protocols based on the Ethereum Blockchain network.
Breaking bad streak of US stocks
An important fact to mention is that the largest exchanges to bet on cryptocurrency futures and options are not from the United States. In this sense, the CME, seeks to break this bad streak and present itself as an alternative to OKEx, Huobi and Binance, sites in which cryptocurrency operators prefer to bet.
CME Charges d’affaires have previously denied having any ETH-related plans. Some of them even rated Ether derivatives as “expired” and “lacking interest.”
The view could have changed radically after the regulators’ process against BitMEX. This is a recent case in which the Commodity Futures Trading Commission (CFTC), will prosecute directors of that firm. Three of them were accused of violating laws related to money laundering.
Data to take into consideration
- At the time of writing, the Total Blocked Value (TVL) of the DeFi of the Ethereum ecosystem, is $ 10.8 billion USD.
- Based on the success of DeFi in 2020, the CME is evaluating the possibility of opening a futures market with ETH.
- Some cryptocurrency traders like QCP Capital, were contacted by the CME to trade in ETH futures.
- The CME markets, related to Bitcoin, started in 2017 (futures) and early 2020 (options).