CME Group revealed plans to add to its crypto lineup with the introduction of bitcoin volatility futures beginning next month.
The new "first-of-their-kind" offering, pending regulatory approval, will list on June 1 to provide traders the ability to trade and hedge bitcoin's (BTC) volatility directly, without taking a directional bet on the cryptocurrency’s price itself.
"Crypto market participants are seeking regulated products that provide opportunities to gain digital assets exposure when markets move," CME Global Head of Cryptocurrency Products Giovanni Vicioso said. "With our new Bitcoin volatility futures, traders will be able to invest or hedge against the future volatility of bitcoin, allowing them to access a critical new layer of risk management."
Expected to trade under the ticker BVI, the cash-settled contracts will be sized with a multiplier of $500 × the BVX index value, according to CME.
The futures will settle to the CME CF Bitcoin Volatility Index (BVX), a real-time 30-day implied volatility measure derived from CME’s CFTC-regulated Bitcoin and Bitcoin Micro options order books. The data is published every second between 7 a.m. and 4 p.m. Chicago time, offering a "transparent, responsive underlying for precision volatility trading."
CF Benchmarks launched its BVX index in 2024 as a non-tradable benchmark and partnered with CME to launch the rebranded joint CME CF Bitcoin Volatility Indices in December, according to the firm’s website.
Similar products have already been introduced on crypto-native platforms, like Deribit’s BTCDVOL futures, which provide a path to wager on the expected volatility of crypto markets. These types of contracts are also widely available for assets like oil, corn, and gold. Traders actively use volatility products to speculate on or hedge against swings.
"The launch of Bitcoin Volatility futures contracts by CME Group marks another major step forward in the maturation of bitcoin as an asset suitable for investors of all stripes: from institutions to individuals," CF Benchmarks CEO Sui Chung said. “With the launch of these CFTC-regulated futures contracts, we anticipate a similar flourishing of regulated financial products that will enable investors to more precisely harness the unique characteristics of bitcoin and express views on forward-looking sentiment and manage risks that have, until now, been difficult to implement."