CME's nonmembers can trade the futures too, although they will be charged for higher service and exchange fees.
The first USA bitcoin futures will start trading next week, as dueling Chicago futures exchanges seek to cash in on surging investor interest in the digital currency. The cryptocurrency is now trading at roughly $11,400, as per CoinDesk's Bitcoin Price Index (BPI). CBOE said Monday that trading will open at 5 p.m. on Sunday, Dec. 10, with Dec. 11 as the first full day of trading.
Bitcoin's price levels have mostly displayed incremental gains within the $11,000 price range.
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"We are pleased to bring Bitcoin futures to market after working closely with the CFTC and market participants to design a regulated offering that will provide investors with transparency, price discovery, and risk transfer capabilities", said Terry Duffy, CME Group Chairman and Chief Executive Officer. But there are a couple of differences between bitcoin futures trading at the two exchanges.
Denis Baranov, a principal consultant at technology consultancy DataArt, says some bitcoin exchanges already offer futures, but the support of a major exchange could boost bitcoin's legitimacy. To ensure minimal impact on markets due to bitcoin's price swings, traders will have to pay 33 percent of their trade's price upfront as compared to the 35 percent for CME bitcoin futures trades. The contracts will be subject to oversight by the Commodity Futures Trading Commission. One bitcoin was worth just a fraction of a penny when it started trading in 2010, and by the start of this year was worth $1,000.
CME Group's Bitcoin futures will be cash-settled, based on the CME CF Bitcoin Reference Rate (BRR) which serves as a once-a-day reference rate of the US dollar price of bitcoin.