CME Group Bullish on Altcoins, to Launch New Benchmarks
Updates to remove references to futures. CME has not launched any new futures instruments.
Exchange operator CME Group said Thursday it will launch 11 new indices that will track the most popular altcoins, including staples like Cardano and Solana. The indexes are partnered with crypto index operator CF Benchmarks and will be launched later in April.
The company will launch 11 products that will track some of the largest altcoins, including Solana (SOL), Cardano (ADA), Polygon (MATIC), Polkadot (DOT), Stellar Lumens (XLM), and Uniswap (UNI). The move is a first for mainstream crypto indices, which have largely tracked the top coins Bitcoin (BTC) and Ethereum (ETH) to date.
CME’s Bitcoin and Ethereum futures are the most popular derivatives on the market and are used as the basis for the largest exchange-traded funds. Today’s move is likely to lead to a large number of new instruments around altcoins, and is expected to lead to more capital inflows.
Growing demand for altcoin indices
CME said in a press release that it saw increasing demand for altcoins amid growing institutional interest in the crypto market. The exchange operator plans to partner with several major crypto exchanges, including Bitstamp, Coinbase, Gemini, and Kraken, to provide data for the indexes.
As the digital asset market continues to grow, there is an increasing demand for reliable, standardized cryptocurrency price information based on robust, regulated reference rates.
†Tim McCourtCME Group Global Head of Equity and FX Products
The new indices are not tradable futures products. Instead, they will provide reference rates and the real-time US dollar price of the tokens. CME has so far not launched any products that offer altcoin futures.
While digital asset managers like Grayscale already have specialized indices tracking altcoins, CME is by far the biggest newcomer to the space.
Altcoins See Growing Institutional Demand
CME’s foray into altcoins reflects the growing demand for non-BTC and ETH tokens observed this year. The latest bull run saw top altcoins largely outperform their more established peers.
Trading patterns in major altcoins, such as large trades, indicate that institutional interest is also picking up.
Several other US asset managers have also launched altcoin-related products for investors. Grayscale recently launched a non-ETH smart contracts fund made up entirely of altcoins, while Coinshares launched an exchange-traded product that tracks Solana’s bet.
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About the author
With over five years of experience in global financial markets, Ambar plans to leverage this knowledge for the fast-growing world of crypto and DeFi. His main interest lies in finding out how geopolitical developments could affect crypto markets and what that could mean for your bitcoin holdings. When he’s not scouring the internet for the latest news, you can play him video games or watch Seinfeld reruns. You can reach him at [email protected]
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