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Ethereum Surging Too Much? CME Group to Launch "Micro" Ethereum Futures Next Month

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Ethereum Surging Too Much? CME Group to Launch "Micro" Ethereum Futures Next Month

In February this year, after launching Ethereum futures contracts, the Chicago Mercantile Exchange (CME) announced that it will introduce "micro" Ether futures by the end of the year. While still pending regulatory approval, Ethereum trading products seem to be updating much faster compared to Bitcoin.

Micro Ether Futures

According to the press release, CME Group will launch Micro Ether futures on December 6. The current Ether futures contract offered by CME is for 50 Ether, equivalent to $225,000, while the Micro Ether contract size is only one-tenth of that.

Tim McCourt, Global Head of Alternative Investments Products, stated:

Since the launch of Ether futures in February, contract liquidity has steadily increased, particularly with the participation of institutional traders. Additionally, following the introduction of Ether contracts, Ether has more than doubled in price, leading to demand for micro contracts. Micro Ether futures will offer users more choices to trade in a transparent and efficient manner.

Is CME a Bear Market Indicator?

In December 2017, CME launched Bitcoin futures contracts as Bitcoin reached an all-time high, coinciding with the end of the Bitcoin bull market and the beginning of a nearly three-year bear market.

Leo Melamed, the Honorary Chairman of CME and known as the "father of futures," stated in November 2017:

We will tame Bitcoin—make it a regular, tame trading commodity.

When CME announced the launch of Ether futures contracts on 2/7 this year, Ether was also at its all-time high of $1,615, sparking debates within the crypto community comparing it to Bitcoin in 2017.

However, subsequent market trends proved that the notion "CME launching contracts = bear market" was merely a concern.

Compared to Bitcoin, which introduced micro futures in May this year after a three-and-a-half-year gap, the plan to introduce Micro Ether contracts just ten months after the launch of futures indicates an accelerated trend in updating crypto products, but it could also be a response to rapid price increases.

Currently, CME offers Bitcoin futures, micro futures, options, and Ether futures. Ether has also continued to hit new all-time highs in the past two days, reaching a high of $4,643 before the deadline, with a closing price of $4,595 on 11/2, also an all-time high.