Eurex expands crypto derivatives portfolio with launch of FTSE Ethereum Index Futures and Options from 12 August 2024.
Following the launch of the FTSE Bitcoin Index Futures and Options in 2023, this is another major milestone in Eurex’s ambition to offer secure access to cryptocurrencies in a regulated market environment.
Ethereum is the second largest cryptocurrency with a market cap of around USD 400 billion. There is significant trading and hedging demand from institutional and professional clients, as reflected in record trading volumes in derivatives and other investment products.
The new options and futures contracts are quoted in EUR and USD, with the respective FTSE Ethereum index as the underlying. The contract size is equivalent to 10 Ether (about 35,000 USD). Both contracts are cash settled and expire on the last Friday of the month. In addition to monthly and quarterly expirations, there will also be weekly expiring contracts for options.
The FTSE Ethereum Index was developed by FTSE Russell together with Digital Asset Research (DAR). It aggregates data from audited assets and exchanges to meet EU benchmarks. The final settlement rate of new Eurex contracts is determined as the volume-weighted average of the FTSE DAR digital asset price for a 15-minute period prior to the settlement time. Liquidity will be supported by the order book and OTC liquidity providers.
Eurex had already launched futures on the FTSE Bitcoin Index in April 2023. Over 100,000 contracts, equivalent to over US$3.5 billion, have been traded since launch. Crypto product offering expanded with options on Bitcoin Index Futures in October 2023, to allow investors to hedge their exposure to Bitcoin and express a more sophisticated market view with various trading strategies (e.g. straddles, spreads put/ call, etc.).
Randolf Roth, Eurex Executive Board Member:
“We look forward to expanding our crypto derivatives offering together with FTSE Russell and Digital Asset Research for our clients. As one of the world’s leading CCPs, Eurex offers trading on a regulated exchange and is therefore the right partner to enter the crypto space for institutional clients.”
Kristen Mierzwa, Head of Digital Assets at FTSE Russell, an LSEG business:
“We are pleased to support the expansions of the Eurex digital asset ecosystem by offering futures and options on the FTSE Ethereum index. In collaboration with the experts at Digital Asset Research, we have created an industry standard for the valuation of underlying digital assets and the inclusion of exchanges. We have applied this screening methodology to offer indices that reflect the real investment market.”