CME XRP futures set to launch May 19 as crypto demand rises

CME XRP futures arriving May 19, expanding access for crypto traders

On May 19 the Chicago Mercantile Exchange (CME) Group is about to launch XRP futures contracts, making it the fourth currency added to its platform after Bitcoin, Ethereum, and Solana.

This is big news for both traders and cryptocurrency enthusiasts, especially because organisational interest in the industry keeps increasing. 

What Are XRP Futures?

These are contracts that enable traders to bet on the future price of the coin without buying the actual tokens. These contracts will be cash-settled. 

CME will offer two types of contracts:

A smaller one covering 2,500 XRP

A larger one covering 50,000 XRP

Prices are going to be decided on the CME CF XRP-Dollar Reference Rate, which updates daily at 11 a.m. UTC. 

Why XRP and Why Now?

The currency is now one of the most-discussed currencies to emerge in the past few years. It's quick, low-cost to transfer, and regularly used for international payments. It's supported by Ripple Labs, a firm which has partnered with large international banks and financial institutions such as Santander, SBI Holdings, and MoneyGram. Currency's underlying technology, the Ledger, is well-regarded for speed and low costs.

It's more options, said CME's head of digital currency products, Giovanni Vicioso. Investors desire more options in the space, and providing this crypto adds one more vehicle they can use to hedge against risk and diversify their books. As a consequence of this, the price of the currency has increased, it has experienced a growth of 2% in the last 24 hours and it is currently trading at $2.19.

Ripple's Legal Victory Paved the Way

A part of the reason why this release is taking place at this moment might be that Ripple has had its recent court dispute with the SEC resolved. After a years-long court saga, Ripple recently agreed to settle by paying an inferior fine of $50 million compared to its original $125 million. Some consider this the green light it needed, with this removing much of the legality which kept some larger players from it. 

A Busy Year Ahead for Crypto Markets

This debut is just two months since CME launched Solana futures, indicating the exchange's determination to build out its digital assets offerings. As for crypto investment products, they are thriving. Around 70 crypto ETFs are pending approval from the SEC. These span the gamut from large tokens such as ETH and Solana to meme coins and NFT-based projects.

A one stand-out usage came from Canary Capital, who sought to file a staked Tron ETF which would potentially give 4.5% annual returns by staking some of its TRX holdings. On top of that, Robinhood announced that it will list CME's XRP futures, which will make it simple for the average trader to participate.

Final Thoughts

Adding this crypto to CME’s lineup is a big deal. It shows that crypto is becoming more accepted in traditional finance, especially as legal issues get cleared up and investor demand rises. Whether you’re a casual crypto fan or a serious investor, this is another sign that digital assets are here to stay and growing fast.

Source: TheCrypto

Writer @Erlin

Erlin is an experienced crypto writer who loves to explore the intersection of blockchain technology and financial markets. She regularly provides insights into the latest trends and innovations in the digital currency space.

 

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