Crypto Insights | Q3

Volatility in the cryptocurrency market began to increase toward the end of Q2 along with the price of Bitcoin and Ether. Clients continued to use the trusted cryptocurrency suite from CME Group to efficiently and effectively manage risk/exposure. Increased client demand for hedging tools led to higher volume and open interest across our Cryptocurrency futures and options offerings.

As the cryptocurrency market recovers from last year’s events, both Bitcoin and Ether have rallied. Bitcoin’s price has increased 81% compared to the beginning of the year while Ether’s price has increased 54% since the start of the year. The resiliency of the leading two cryptocurrencies by market capitalization has attracted additional institutional interest for our suite of trusted cryptocurrency products leading to record volume and open interest across our futures and options. Traders of all kinds are using our cryptocurrency products to manage risk/exposure around-the-clock and protect and benefit from price movements in Bitcoin and Ether. 

Records: 

• Bitcoin futures – ADV: 10.8K contracts (+1% vs. 2022). OI has averaged a record 14.8K contracts (+15 vs. 2022).
• Bitcoin options – ADV: 345 contracts (+132% vs. 2022). OI has averaged a record 9.4K contracts (+175% vs. 2022).
• Micro Bitcoin options – ADV: 504 contracts (+28% vs. 2022). OI averaged a record 5K contracts (+7 vs. 2022).
• Ether futures – OI averaged a record 4.3K contracts (+6% vs. 2022).
• Ether options – ADV: 70 contracts (+268% vs. 2022). OI averaged a record 1.6K contracts (+338 vs. 2022).

• Ether/Bitcoin Ratio futures arrive July 31* and enable traders to efficiently capture the relative value between Ether and Bitcoin in a single transaction. The new contract will be cash-settled based on the settlement prices of the corresponding futures contracts. Ether/Bitcoin Ratio futures can help market participants access Ether-Bitcoin exposure without the need to take a directional view. View the FAQ.
  *Pending regulatory review
• New options expiries available enjoy greater precision and versatility in managing short-term Bitcoin and Ether risk with the expansion of weekly options expiries across our Cryptocurrency options suite:  
  • 10 new weekly options on Bitcoin futures and Ether futures:  
    • Monday, Tuesday, Wednesday, Thursday, and Friday options on Bitcoin futures  
    • Monday, Tuesday, Wednesday, Thursday, and Friday options on Ether futures  
  • Four new weekly options on Micro Bitcoin futures and Micro Ether futures:   
    • Tuesday and Thursday options on Micro Bitcoin futures
    • Tuesday and Thursday options on Micro Ether futures   

These new contracts complement our existing monthly and quarterly Cryptocurrency options. View the FAQ.

• Event Contracts on Bitcoin futures: 
  Launched on March 13, event contracts provide traders a new way to gain exposure to Bitcoin futures price movement. These limited-risk, cash-settled, daily expiring contracts on Bitcoin futures complement our suite of 10 events contracts tied to benchmarks futures markets.  Over 30K Bitcoin event contracts have traded since launch.  Fees are waived through the end of August, discover more here.

Bitcoin futures (BTC) institutional interest continued to increase throughout the quarter as investors sought regulated venues/products to hedge rising market volatility and manage risk and exposure. Q2-23 ADV was over 10.6K contracts and OI averaged 14.3K contracts. The number of LOIHs averaged a record 107 in Q2-23. Bitcoin options had a record average OI of 9.9K in Q2-23, +12% vs. Q1-2023.

Ether futures (ETH) Over 3.1M contracts (156M equivalent ether) traded since launch just over two years ago. LOIHs averaged 62 throughout the quarter. Options on Ether futures have now traded over 10K contracts since their September 2022 launch. A record 421 Ether options were traded May 5 and OI reached a record 2.6K on June 30.

Micro Bitcoin and Micro Ether futures (MBT and MET) provide precise, cost-effective tools to manage cryptocurrency risk. Micro Bitcoin and Ether futures Q2-23 ADV was a combined 21K (+6% vs. Q1-23). MET OI averaged 16K contracts while MBT OI averaged 10K. Since their respective launches, over 8.7M MBT contracts have traded and over 6.4M MET contracts have traded. Micro Bitcoin and Micro Ether options offer greater flexibility and granularity to manage risk, over 600K contracts have traded since launch.

 More on cryptocurrency products at CME Group

All data accurate of June 30, 2023, unless otherwise indicated.