Ether futures product overview

Ether futures (ticker symbol: ETH) from CME Group are cash-settled contracts based on the CME C-F Ether-Dollar Reference Rate. Launched in 2018, ETHUSD_RR is a daily reference rate that aggregates Ether US dollar transactions on the constituent Ether spot exchanges during a one-hour calculation window into the US dollar price of one ether as of 4 p.m. GMT/BST.   

In order to determine the Ether Dollar Reference Price, the one-hour calculation window is partitioned into 12 five-minute intervals, where the volume-weighted median is calculated for each five-minute partition, and then, all twelve medians are equal-weight averaged to one price that becomes the ETHUSD_RR for the day.

Contract specifications

Each futures contract has a value of 50 ether and is quoted in US dollars per one ether. For example, if the CME CF Ether Dollar Reference Rate is $400, one Ether futures contract will have a notional value of $20,000 US dollars. 

Ether futures will tick in increments of one-quarter index point, meaning a one-tick move of ETH futures is equal to $12.50.

The tick size for spread trades will be $0.05 per index point per ether or $2.50 per contract. The Ether futures contract trades on CME Globex from Sunday through Friday from 5 p.m. to 4 p.m. Central Time (CT). Additionally, the contracts are block trade eligible with a minimum size of five contracts. 

Ether futures are also eligible for exchange for physical (EFP) transactions. EFPs are privately negotiated trades between two counterparties allowing them to simultaneously transfer a futures position for an equivalent spot market position or vice versa. In this case, a market participant may exchange a position in physical ether for an equivalent position in CME Group Ether futures and vice versa.

ETH futures expire on the last Friday of the contract month and are listed on the nearest six consecutive monthly contracts, inclusive of the nearest two December contracts.

An example

For example, assume it’s January and the six consecutive contract months are January, February, March, April, May, and June. In addition, that year’s December contract plus next year’s December contract will also be listed.

As one contract expires, the next contract to complete the six-month lineup is added. 

When the December contract expires, the June contract becomes active, in addition to the December contract for the next year. So, at any time, there are six consecutive monthly contracts and only two December contracts listed. This process continues throughout each year.

Ether futures are joining the expanding suite of cryptocurrency products from CME Group – providing an additional tool for market participants to hedge their digital asset risk.

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