CME Group to Introduce Bitcoin Spot Trading, Reports FT

The world’s largest financial derivatives exchange, CME Group, is planning to launch spot trading in bitcoin, complementing its existing futures product, according to FT.

Sources cited by the publication indicate that the Chicago-based company is consulting with traders interested in cryptocurrency operations on a regulated market. The plan is not yet finalized.

The introduction of bitcoin trading on CME would allow traders to profit from basis trades, exploiting the difference between futures prices and spot quotes of the underlying asset, FT noted.

If implemented, the exchange would provide another channel for Wall Street firms to expand access to digital gold, in addition to ETFs, journalists believe.

Since their launch in January, 11 exchange-traded bitcoin funds based on spot prices have attracted $12.15 billion in institutional capital. Recent days have seen investments from entities such as the State of Wisconsin Investment Board ($163 million) and the hedge fund Millennium Management ($1.94 billion) into these products.

CME intends to use its currency trading platform EBS in Switzerland to organize spot bitcoin trading. The European country has well-developed rules for digital asset operations, while U.S. authorities face criticism for a lack of clear regulation, FT emphasized.

In a comment to the publication, an unnamed executive of a crypto trading firm expressed doubt that CME could capture a significant market share under such circumstances. He noted the difficulty in envisioning how the exchange could leverage all its opportunities in the U.S.

According to FT, CME’s competitor, CBOE, announced in April that it would close its spot crypto trading business in the United States due to legal uncertainties.

CBOE launched a digital asset trading platform after acquiring the regulated platform ErisX in May 2022.