Regulated XRP futures have officially hit CME markets for the first time, sparking hopes for the development of spot XRP exchange-traded funds as the US Securities and Exchange Commission reviews their launch.
XRP Futures Start Trading on CME
The Chicago Mercantile Exchange (CME) began trading regulated XRP futures on Monday, marking the first time such contracts have been traded in the U.S. The launch of these cash-settled futures comes with two contract sizes: 2,500 XRP and 50,000 XRP. These contracts will be priced off a daily reference rate, specifically the SME CF XRP-Dollar Reference Rate.
XRP futures are a type of derivative contract that allows traders to bet on the future price of Ripple's cryptocurrency, 'XRP'.
These contracts are traded on various online platforms and can be used for both speculative and hedging purposes.
The value of an XRP futures contract is tied to the underlying asset, and it can be settled in cash or physically delivered.
Traders can choose from different types of XRP futures, including perpetual swaps and quarterly options, each with its own unique characteristics and risks.
Key Features of CME’s XRP Futures
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Two contract sizes available: 2,500 XRP and 50,000 XRP
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Cash-settled and based on the SME CF XRP-Dollar Reference Rate
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Priced off a daily reference rate to track the price of XRP at 4:00 p.m. London time
The launch of these regulated futures may support efforts to list a spot XRP exchange-traded fund (ETF), which remains under review by the Securities and Exchange Commission (SEC). Several U.S. issuers have filed to launch such a fund but have yet to receive a decision.
An exchange-traded fund (ETF) that tracks the price of Ripple's cryptocurrency, XRP.
The XRP ETF allows investors to gain exposure to the digital asset without directly holding it.
It typically holds a basket of underlying assets, such as futures contracts or physical XRP, to track the price movement.
Regulators have approved several XRP ETFs for trading on major exchanges.
Background on CME’s Futures Offerings
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The CME already offers regulated futures contracts for bitcoin, ethereum, and solana
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The Group’s SOL futures launched in mid-March with lower initial notional daily volume compared to the debut of ether and bitcoin futures
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The price of XRP was down 3.45% over the past 24 hours
The existence of regulated futures could mark a significant step forward for the development of spot XRP ETFs, which are currently under review by the SEC.
‘CME-traded XRP futures are now live,’
wrote
ETF Store President Nate Geraci on X. ‘CFTC-regulated contracts on XRP. Spot XRP ETFs only a matter of time.’
The launch of these regulated futures demonstrates the growing interest in digital assets and the need for more transparent and regulated markets. As the landscape continues to evolve, it will be important to monitor developments in this area and their potential impact on the broader crypto market.
Digital assets, including cryptocurrencies and non-fungible tokens (NFTs), are becoming increasingly popular. However, their lack of regulatory clarity has led to concerns about investor protection, market manipulation, and tax evasion. In response, governments worldwide are developing regulations to govern digital asset transactions. For instance, the US Securities and Exchange Commission (SEC) has issued guidelines on how to determine whether a digital token is a security or not. Similarly, the European Union's Markets in Crypto-Assets Regulation (MiCA) aims to provide a comprehensive framework for regulating digital assets.
- coindesk.com | XRP Futures Start Trading on CME
