As Nasdaq notes, the CFTC officially states that lower-risk trading instruments are not subject to limits. Therefore, an agreement to lessen the strict controls for CME could be construed as the regulator having more faith in Bitcoin (BTC) options than before.
The Chicago Mercantile Exchange (CME) Group is petitioning United States regulators to allow its clients to double their open Bitcoin futures positions.
Double open positions limit, says CME
According to Nasdaq on Sept. 12, CME has already put its plans before the Commodity Futures Trading Commission (CFTC).
If successful, each investor would gain a monthly limit of 2,000 contracts per spot month instead of the current 1,000.
The move comes on the back of constant growth in demand for Bitcoin futures, with CME’s volumes setting new records on a regular basis.
“This is one more way we’re providing customers, institutional traders and end-users with additional flexibility to trade and hedge bitcoin price risk,” a spokesperson told the publication.
March of the Bitcoin futures contracts
CME was one of the first Bitcoin futures operators, launching its product in December 2017. Since then, the market has expanded, with the second half of this year set to see a significant increase in overall interest.
Later in September, Bakkt, the regulated trading ecosystem for institutional investors, will launch physical Bitcoin futures, which pay out returns in BTC instead of fiat currency.
Cryptocurrency exchange Binance is currently testing two potential futures trading platforms.
Bitcoin.com Looks to List BCH Futures on CFTC-Approved Exchange
Bitcoin.com is in talks to list a bitcoin cash (BCH) futures contract on a regulated exchange, according to David Shin, head of the company’s exchange division.
In an interview with Bloomberg, the Singapore-based Shin said he had early talks to ensure a BCH futures contract would be available on an exchange regulated by the Commodity Futures Trading Commission (CFTC). He also said Bitcoin.com hoped to partner with a retail brokerage.
No CFTC-regulated exchange offers bitcoin cash futures. Bitcoin cash is the fourth-largest cryptocurrency, behind bitcoin, ethereum and XRP. Shin said the push into futures would increase trading volumes and liquidity, and ultimately boost BCH’s market cap.
Bitcoin cash was trading Thursday afternoon around $300 a coin with a market cap of nearly $5.4 billion dollars, according to CoinDesk data. This is half the market cap of XRP, the next-closest coin, and 1/35th the value of market leader bitcoin.
Crypto futures are new to US investors. Available via the Chicago Mercantile Exchange (CME) since December 2017, only one other U.S. exchange – Bakkt, which trades futures through ICE – has been approved, and that was just last month. LedgerX and TD Ameritrade-backed ErisX are awaiting final regulatory approval to expand their options trading to include futures contracts.