The CME Group launches Asia-focused Bitcoin reference rates
The CME Group will introduce two Bitcoin reference rates specifically tailored for the Asian market. These rates, the CME CF Bitcoin Reference Rate APAC and the CME CF Ethereum-Dollar Reference Rate, will be published daily at 16:00 Singapore time starting from September 11. The purpose of these rates is to meet the needs of derivatives trading outside of US business hours.
Key Points:
– Asians account for 11% of all trading outside US business hours.
– Traders can use the precise timing of the publication of these rates to hedge against volatility based on their risk appetite.
– CF Benchmarks CEO emphasizes the importance of accurate rates in building institutional confidence in the crypto sector.
– The rates will be calculated and administered to the same standards as the London and New York counterparts.
– CME Group uses a weighted median of a cryptocurrency’s trades across multiple time slots to determine the reference rate.
SEC’s concerns regarding accurate pricing and reference rates
The US Securities and Exchange Commission (SEC) has highlighted the need for accurate pricing in approving Bitcoin spot ETFs. Coinbase has agreed to assist some ETF applicants in monitoring markets for irregular behavior. Grayscale previously sued the SEC for rejecting a spot Bitcoin ETF that used the same price reference as Bitcoin futures products. If Grayscale wins the lawsuit, it could pave the way for the approval of multiple Bitcoin ETFs in the US.
Key Points:
– Accurate pricing is crucial for the approval of Bitcoin spot ETFs by the SEC.
– Coinbase is helping ETF applicants monitor markets for irregular behavior.
– Grayscale’s lawsuit against the SEC could lead to the approval of Bitcoin ETFs in the US.
– Purpose Investments’ Bitcoin ETF in Canada has attracted interest from the US.
– Cboe Digital has obtained approval from the CTFC to offer leveraged margin trading of Bitcoin and Ethereum futures.
Hot Take
The launch of Asia-focused Bitcoin reference rates by the CME Group demonstrates the increasing demand for crypto derivatives trading outside of US business hours. These rates aim to provide traders with precise timing information to hedge against volatility. Furthermore, accurate reference rates are crucial for building institutional confidence in the crypto sector, as highlighted by the CEO of CF Benchmarks. The SEC’s emphasis on accurate pricing for Bitcoin spot ETFs reflects the regulatory concerns surrounding the industry. However, the approval of a Bitcoin ETF in Canada and the potential success of Grayscale’s lawsuit against the SEC indicate positive developments for the adoption and acceptance of cryptocurrencies.
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