The Chicago Mercantile Exchange (CME) has launched its much-anticipated futures contracts for ether (ETH), the native cryptocurrency of the Ethereum blockchain network.
Announced in mid-December, trading in ether futures went live late Sunday, with the February contract registering an opening price of $1,669.75. At the time, the spot price stood at around $1,600.
The Chicago-based exchange has traded 77 contracts so far, with most activity concentrated on the February expiry. The futures contracts are legal agreements to buy or sell the crypto asset at a predetermined price at a later date.
CME’s ether futures are cash-settled and based on the exchange’s reference rate that includes data from major cryptocurrency exchanges Bitstamp, Coinbase, Gemini, itBit and Kraken.
The world’s first regulated ether futures product may draw more institutional demand for the second-largest cryptocurrency by market value, boosting the recent price rally.
“The earliest traditional financial institutions that bought BTC are already looking at ETH, if not bought already. And rightfully so. The most used crypto network + future of finance + a potential deflationary monetary policy narrative make it extremely compelling,” Qiao Wang, cryptocurrencies researcher and investor and co-founder of Messari, tweeted on Sunday.
Wang foresees ether rallying to $5,000 and higher in the long run.
The cryptocurrency has more than tripled in value since the CME announced plans to list futures contracts on Dec. 16, mimicking bitcoin’s surge from $6,000 to $19,783 seen in the weeks leading up to Dec. 17, 2017, when the exchange began trading bitcoin futures.