CME Group to Launch XRP Futures Trading on May 19
1min read The cme group is set to launch futures trading on XRP on May 19, pending regulatory review. This move will allow both micro and large contracts, ranging from 2,500 to 50,000 XRP, emphasizing flexibility and precision. This development is expected to bring several key advantages to the asset, including substantial liquidity. The CME Group will treat XRP as a commodity, similar to Bitcoin and Ethereum, which could potentially boost the chances of an XRP ETF approval.
XRP futures are financial contracts that allow traders to speculate on the future price of XRP without owning the actual coins. This will enable institutional and professional traders to hedge risk or speculate on XRP prices using regulated instruments. The involvement of the CME Group, the world’s largest derivatives exchange, adds legitimacy and market depth to XRP.
The CME Group has shown interest in crypto futures trading over the past few months. It hinted at launching Solana and XRP futures in January but couldn't officially commit to the strategy until approval. The CME Group began Solana futures trading last month and is set to open XRP futures on May 19. Ripple CEO Brad Garlinghouse expressed excitement about this development, stating that it is an important step in the continued growth of the XRP market.
Futures trading in the institutional market could potentially aid the chances of an XRP ETF. Additionally, it opens a huge window of new liquidity for the token. The recognition of the CME Group’s brand will guarantee product quality in the eyes of institutional investors. Coinbase added XRP futures trading earlier this week after receiving official approval. The CME Group is also a regulated institution, but it will take a few weeks to offer its own XRP futures.
The announcement acknowledges that it still requires regulatory approval, possibly explaining the long wait. These futures will be cash-settled and based on the CME Group’s XRP-Dollar reference rate, which is calculated daily. XRP’s demand hit a five-month low this week, and the CME Group won’t offer futures for nearly a month. This news is undoubtedly bullish, but it may take some time to materialize fully in the market.
Ask Aime: "Will XRP ETF approval be next on the horizon after CME futures trading launch?"
