CME Group announced its plans to launch Bitcoin options on futures four months ago. However, the platform announced the opening of its options market for investors and traders. It was revealed through its official Twitter handle, mentioning that it provides better capital efficiencies and another means of managing Bitcoin exposure.
Tim McCourt, CME Group head of equity index and alternative investment products also shared his view on the option on CME Bitcoin Futures.
The platform first announced the introduction of a regulated Bitcoin options market. Notwithstanding, Bakkt was able to deliver the product last month by opening its platform for Bitcoin options on top of its Bitcoin Monthly Futures contract.
Besides, FTX also introduced options trading before CME and it recorded $1 million in trading volume. However, CME eventually delivered the product on January 13, 2020.
Market participants consider options trading to be quite risky and volatile, and there has been a dynamic change in sentiment around the futures market within the previous few months. A likely factor that prompted this is the regulator’s approval of regulated futures markets, CME and CBOE in the end of 2017, towards containing the “Bitcoin bubble,” thereby leading to price decline.
Bobby Ong ascertained the factor but also added that price always become quite volatile every time “we lead to CME’s contract expiry on the last Friday of the month at 4pm London time.”
Concerning the possibility of seeing a positive response in the options market after the launch, Ong maintained that the likelihood of having slow growth but will ultimately grow to 20 percent “of the derivatives market mirroring traditional markets.”