The world’s largest futures exchange, CME Group, will start offering an Ethereum Real-Time reference and price index. The launch date is June 4th, 2018. The exchange has teamed with digital data services company, Crypto Facilities, for the new offering.
Dubbed, Ether-Dollar Reference Rate, the price listing will be calculated by Crypto Facilities using data gathered from Kraken and Bitstamp. Crypto Facilities currently offers cryptocurrency price information to financial institutions in addition to making it possible for people to trade cryptocurrency futures with up to 50:1 leverage.
The derivatives exchange operator expects the ether reference rate and real-time index to provide daily benchmark prices in U.S dollars as well as real-time prices based on transactions and order book activity
An addition of the Ethereum price listing data does not come as a surprise, given that the CME group made its debut into the cryptocurrency space with the launch of Bitcoin futures late last year. According to Tim McCourt, managing director, the new index is designed to meet the ever-evolving needs in the marketplace
“We are excited to be contributing to the strong community that has developed around the Ethereum network by providing a reliable reference rate and real-time Ether-Dollar price,” said Crypto Facilities CEO, Timo Schlaefer.
Ethereum Future Contract Talk
The unveiling of the Ether Reference Rate and Real-Time index also paves the way for CME Group to eventually list Ethereum futures contracts after unveiling Bitcoin futures last year. The listing should go a long way in providing institutional investors with exposure to the emerging asset class. Cryptocurrency miners will also be able to hedge their profits more effectively.
The CME Group launched the reference rate and pricing index a year before it launched Bitcoin futures. Bitcoin futures have continued to skyrocket having registered as much as $500 million in volume during a single trading session.
Cryptocurrency futures products are becoming increasingly popular. Listing companies are taking advantage of an influx of institutional investing. These investors hope to diversify their investment portfolio with the new asset class.
Sentiment in the cryptocurrency space have improved greatly in recent months after sharp decline in prices in early 2018. The turnaround has come on growing confidence that virtual currencies are here to stay. This confidence could have them find their way into the mainstream sector sooner then later.