Bitcoin futures contracts, when launched in December of last year, created ripples in the cryptocurrency markets. It highlighted the beginning of a new era in the cryptocurrency segment, which allowed for the participation of regulated entities in the wild west of the crypto world.
Now Cboe, one of the pioneers of Bitcoin futures, will be bringing Ethereum futures contracts to the market. Cboe started informing market makers of its new product. A source who is familiar with the situation suggested that Cboe is merely waiting for the Commodity Futures Trading Commission (CFTC) to clear the way for the derivative.
Ethereum Futures by the End of 2018?
Some sources who know about the development are predicting that the futures contract could be launched by the end of 2018, as reported by Business Insider. It is reported that Cboe has already started spreading the word about a futures product for the second largest digital currency by market cap.
In the US, Bitcoin futures are handled by Cboe and CME. Bitcoin futures debuted in December 2017, and the launch helped Bitcoin hit an all-time high. Though Bitcoin futures have been muted relatively since their debut, the launch of Ethereum futures contract could be an important step toward the blossoming of Ethereum as it could pave the way for higher volumes of trading of the currency and perhaps an exchange-traded fund (ETF) in the future.
Danny Kim, head of growth at crypto trading technology firm SFOX, commented on the situation:
“CBOE’s offering will enable crypto traders to take both long and short positions in ether, and it’s another step forward to a new accepted asset class. With this, I think the new investment opportunity will take crypto out of the bearish market and reverse to a new bull.”
If Kim is to be believed, then the next crypto bull run could be led by Ethereum.
Has the CFTC Approved the Launch?
The exchange is said to be waiting for the CFTC to clarify its stance on the project. Once it gets a nod from the CFTC, the Ethereum futures will be launched.
In June this year, a Securities and Exchange Commission (SEC) director noted that Ethereum doesn’t appear to be violating any securities law.
The new futures market would be based on Gemini exchange’s underlying market, the sources suggest. Gemini is a cryptocurrency exchange based in New York and run by the Winklevoss twins Cameron and Tyler, who have tried and failed to introduce a Bitcoin ETF twice.