CME Group Ends In-Person Trade, Successfully Launches Micro Bitcoin Futures

CME Group Inc CME announced an end to most open outcry trading pits while honing in on emerging markets with new products like Micro Bitcoin futures.

What Happened: Founded in 1848, CME Group is an exchange that builds markets around derivatives like futures, or agreements to buy and sell assets at a particular price and time in the future.

The company has a long-standing history, offering global benchmark products based on interest rates, equity indices, foreign exchange, and commodities. In addition to building products, CME also facilitates and clears trades through its clearinghouse, CME Clearing.

The organization’s move to end in-person trade for most products accelerated around 2015, after open outcry fell to just 1% of total volume. Now, only CME’s Eurodollar options pit will continue to operate.

Why It Matters: The move to end in-person trade comes as the pandemic accelerated the digital disruption in finance; by and large, market participants demand the efficiency, transparency, and prospects of growth electronic markets offer.

Adding, CME, in meeting the demands of emerging market participants, recently launched Micro Bitcoin futures, which are 1/10 the size of one bitcoin and 1/50 the size of the standard CME Bitcoin future. The smaller size makes the product easier to consume by smaller participants.

The product, thus far, has been well-received trading nearly 2.5 times as many contracts as the standard Bitcoin future, Tuesday.

CME Group Global Head of Equity Index and Alternative Investment Products Tim McCourt said, “At one-tenth the size of one bitcoin, Micro Bitcoin futures will provide an efficient, cost-effective way for a broad array of market participants- from institutions to sophisticated, active traders- to fine-tune their bitcoin exposure and enhance their trading strategies, all while retaining the benefits of CME Group’s standard Bitcoin futures.”