The Chicago Mercantile Exchange (CME) has unveiled its long-awaited futures contract for ether (ETH), the original cryptocurrency of the Ethereum blockchain network.
Announced in mid-December, the trading of ether futures contracts was live late Sunday, with the February contract recording an opening price of $ 1,669.75. At the time, the spot price was about $ 1,600.
The Chicago Stock Exchange has so far traded 77 contracts, with most activities concentrated on the February expiration. The futures contracts are legal agreements to buy or sell the crypto asset later at a predetermined price.
CME’s futures contracts are settled in cash and are based on the exchange’s reference rate, which contains data from the major cryptocurrency exchanges Bitstamp, Coinbase, Gemini, itBit and Kraken.
The world’s first regulated ether futures product may attract more institutional demand for the second largest cryptocurrency by market value, which will increase the recent price increase.
“The earliest traditional financial institutions that BTC bought are already looking at ETH, if it has not been bought yet. And rightly so. The most widely used crypto network + future of finance + a possible narrative monetary policy story makes it extremely compelling, ‘Qiao Wang, cryptocurrency researcher and investor and co-founder of Messari, tweeted on Sunday.
Cheek provide ether in the long run up to $ 5,000 and higher. Ether traded close to $ 1,632 at the time of going to print, a gain of 1% on the day and reached a record high of more than $ 1,700 on Friday.
The cryptocurrency has more than tripled in value since the CME announced plans to list futures contracts on December 16, mimicking the rise of bitcoin from $ 6,000 to $ 19,783, seen in the weeks before December 17, 2017, when the exchange bitcoin futures start trading.
While bitcoin was up and running on the same day and then moved to a year-long bear market, ether is likely to remain so. “The market is more mature now, the macro is different and there are different players involved,” said Alex Kruger, trader and analyst. tweeted last week, which precludes a significant accident in ether.
Wang also expressed a similar opinion on Sunday, warning that a bet on an ether market would be ‘the worst trade in your life’.
Patrick Heusser, head of trading at Swiss Crypto Finance AG, provides ether that will lead the broader market higher. “I turned on ETH / BTC over the weekend and reduced some DeFi exposure,” Heusser told CoinDesk. “I do not see any connection with the ETH futures listing and any specific price action associated with it.”