Cboe to Launch Margined Bitcoin and Ethereum Futures

Almost six months after obtaining a license to offer margined Bitcoin and Ethereum futures contracts to its crypto clients, Chicago Board Options Exchange popularly referred to as Cboe has announced plans to launch the offering by January 11, 2024, with backing from top cryptocurrency and traditional finance investors.

Cboe to Hit New Milestone in the US

Earlier today, Global Markets reporter, Walter Bloomberg on the X app posted the news of the potential launch of trading and clearing in margin futures on BTC and ETH by Cboe. If it goes as planned, Cboe is billed to become the United States’ first regulated crypto native exchange and clearinghouse to enable both spot and leveraged derivatives trading on a single platform. 

The exchange regards this potential move for Cboe Futures as part of its commitment to offering trust, transparency, and responsible innovation to its users and the entire crypto sector, especially the spot and derivatives markets.

“Cboe Digital presents an intermediary-inclusive model, ensures separation of duties to avoid conflicts of interest, and uses an integrated exchange-clearinghouse model that will allow it to potentially bring more unique and groundbreaking offerings in 2024,” the announcement stated.

The Cboe Futures offering which is still underway has gained support from about 11 crypto and traditional finance companies including B2C2, BlockFills, CQG, Cumberland DRW, Jump Trading Group, Marex, StoneX Financial, Talos, Trading Technologies, and Wedbush.

Gradual Launch of the Futures Products

Notably, the products will be rolled out in sequence, starting with a focus on financially settled margined contracts on Bitcoin and Ethereum. Depending on feedback but more importantly, pending regulatory approvals, the Cboe Futures offering may upscale to include physically delivered products. 

One outstanding peculiarity of the margin model is its capacity to accommodate futures trading without having to update full collateral beforehand, which is usually a requirement with other systems. Amongst many benefits, the Cboe Futures product will boost capital efficiency and also make it easier for investors to gain access to the spot and derivatives markets.

Once again, this is a milestone in the fusion of traditional finance and the digital assets ecosystem. It expresses a growing acceptance and adoption of cryptocurrencies in the broad financial world, a clear example that is seen in the case of the numerous applications for spot Bitcoin ETF with the United States Securities and Exchange Commission (SEC).