CME Group is gearing up to launch XRP futures on May 19, pending regulatory approval.
As per an April 24 statement, the futures will come in two contract sizes, one linked to 2,500 XRP and the other to 50,000 XRP.
These contracts are tailored to suit various investment strategies, and they will be cash-settled and pegged against the CME CF XRP-Dollar Reference Rate, calculated daily at 4:00 P.M. London time.
Giovanni Vicioso, Global Head of Cryptocurrency Products at CME Group, highlighted the increasing demand for XRP and its native blockchain, the XRP Ledger (XRPL). He emphasized the rising adoption by institutional and retail investors, presenting the upcoming futures as a cost-effective option for portfolio management and risk hedging.
XRP currently holds the fourth spot in the crypto market, with a market cap exceeding $126 billion. According to CryptoSlate data, it was trading around $2.19, having dropped 2% in the past 24 hours.
Furthermore, this impending launch will broaden the company’s lineup of crypto derivatives, which already includes Bitcoin, Ethereum, and Solana.
Vicioso noted the increasing demand for regulated derivatives products covering a wider array of tokens as the digital asset market progresses.
XRP ETF
CME’s venture into XRP follows closely on the heels of Coinbase Derivatives introducing CFTC-regulated XRP futures. These simultaneous moves bolster XRP’s presence in the US financial sector.
These developments could play a crucial role in the potential approval of spot XRP exchange-traded funds (ETFs) by the US Securities and Exchange Commission (SEC).
Tony Edwards, the founder of the Thinking Crypto podcast, expressed:
“This is big and important for XRP spot etf approval!”
Previously, the financial regulator cited the absence of a regulated futures market as a reason for rejecting spot ETF applications for altcoins. With XRP futures falling under CFTC oversight, that obstacle may no longer apply.
Several asset managers, including 21Shares, Canary, and Bitwise, have already put forth proposals for a spot XRP ETF. JPMorgan has forecasted that these ETFs could amass up to $8 billion in assets in their inaugural year.
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