The new product is set to provide investors with information about Bitcoin price movements on the underlying CoinDesk Bitcoin Price Index (XBX) and will be settled only in United States dollars.
TMX Group, a leading exchange in Canada, has announced plans to launch cash-settled Bitcoin futures on the Montreal Exchange (MX) soon. According to the announcement, cash-settled Bitcoin futures will track the decade-old CoinDesk Bitcoin Price Index (XBX). Specifically, MX Bitcoin futures contracts will be settled in United States dollars and cleared at the Canadian Derivatives Clearing Corporation (CDCC).
Cryptocurrency exchanges are taking advantage of the growing demand for digital asset products, especially due to delays in approval by the United States SEC. Bitcoin Spot ETFs among others. Additionally, the Canadian government has implemented a clear virtual assets regulatory framework which has helped the industry grow in this region.
“Cryptocurrency is gaining momentum in Canada, with demand for investments in digital asset classes increasing. “Despite growing interest, investors face limitations when evaluating vehicles to manage their exposure to Bitcoin price movements,” the company said. noted,
The CoinDesk Bitcoin Price Index (XBX), which is issued by CoinDesk Indices (CDI), has provided frequent real-time price updates since 2014 and currently has approximately $17 billion in assets under management (AUM). TMX Group’s announcement did not provide any timeline for the Bitcoin futures contract launch, thus leaving a gap for speculation.
Notably, CoinDesk will join other firms such as Montreal Exchange ICE Futures Singapore Futures Contract, Grayscale Bitcoin Trust, and Purpose Bitcoin ETF in tracking the Bitcoin price index.xbox,
bitcoin futures market
Over the past few years, demand for Bitcoin products to help investors manage risk from crypto price movements has increased significantly. For example, the Chicago Mercantile Exchange (CME) launched a Bitcoin futures product in its lineup earlier this year. A dozen more institutions have filed to launch a Bitcoin futures ETF in the United States as the push for spot Bitcoin ETFs continues.
Essentially, Bitcoin futures contracts help investors diversify their portfolios in the cryptocurrency industry amid the mainstream adoption of the digital asset. With Bitcoin futures, crypto traders can easily understand the price action of the underlying asset as liquidity improves over time.
market Outlook
The market cap of the cryptocurrency market YTD remains above $1 trillion despite short-term uncertainties. Bitcoin (BTC) has managed to retain the top position with a market dominance of around 50.43 percent. The price of Bitcoin exchanged hands at around $27.4k on Wednesday, up nearly 6 percent over the past four weeks, according to the latest crypto market data.
Bitcoin is expected to continue increasing in value in the coming years, even more so after the fourth halving with increasing demand from institutional investors.
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