Coinbase launches “institutional-sized” bitcoin and ether futures

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The deriv­a­tives arm of US cryp­to exchange Coin­base will offer “insti­tu­tion­al-sized” bit­coin (BTC) and ether (ETH) tracked futures for insti­tu­tion­al clients start­ing June 5.

Coinbase

Coin­base Deriv­a­tives Exchange said these futures con­tracts are specif­i­cal­ly designed to cater to the grow­ing insti­tu­tion­al demand in the mar­ket, build­ing upon the suc­cess of its pre­vi­ous­ly issued nano Bit­coin (BIT) and nano Ether (ETI) con­tracts intro­duced last year.

With the launch of these new futures offer­ings, Coin­base aims to fur­ther expand its insti­tu­tion­al ser­vices and pro­vide addi­tion­al invest­ment options for its clientele.

The promi­nent cryp­tocur­ren­cy exchange spec­i­fied that the BTI (Bit­coin Tracked Index) and ETI (Ether Tracked Index) futures con­tracts are struc­tured to rep­re­sent 1 BTC and 10 ETH per con­tract, respec­tive­ly. Based on cur­rent prices, the notion­al val­ue of the BTI con­tract is approx­i­mate­ly $30,000, while the ETI con­tract holds a notion­al val­ue of around $20,000.

Coin­base added that the BTC and ETI futures con­tracts are avail­able at “sig­nif­i­cant­ly low­er fees” in com­par­i­son to tra­di­tion­al offer­ings. How­ev­er, the exact fees for these con­tracts have not been disclosed.

Set­tled in U.S. dol­lars, on a month­ly basis, these con­tracts enable pro­fes­sion­al investors to hedge their mar­ket posi­tions, express long-term mar­ket views, or uti­lize them as com­po­nents of more intri­cate trad­ing strategies.

Deriv­a­tives, in the con­text of finance, are con­trac­tu­al agree­ments that derive their val­ue from an under­ly­ing asset. In the cryp­tocur­ren­cy space, the deriv­a­tives mar­ket involves traders pur­chas­ing con­tracts based on the pro­ject­ed future price move­ments of dig­i­tal assets. With these futures con­tracts, traders can par­tic­i­pate in the price fluc­tu­a­tions of Bit­coin and Ethereum, allow­ing them to poten­tial­ly prof­it from their pre­dic­tions about the future val­ue of these cryptocurrencies.

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