TMX Group, the largest Canadian exchange, announced on Tuesday that its derivatives trading platform is set to introduce Bitcoin (BTC) futures contracts.
In an announcement posted on the company’s website, the Montréal Exchange (MX) revealed its plans to launch Bitcoin Price Index Futures to meet the growing market demand for digital cryptocurrency asset classes. The announcement stated, “Despite the increasing interest, investors often encounter limitations when seeking vehicles to manage their exposure to bitcoin price fluctuations.”
These futures will be cash-settled in U.S. dollars, meaning that settlement involves the exchange of dollars rather than the underlying asset (in this case, bitcoin). The settlement value of the futures will be determined using the CoinDesk Bitcoin Price Index (XBX), which is developed by CoinDesk Indices, a subsidiary of CoinDesk.
This move comes at a time when traditional financial institutions are expanding their offerings related to digital assets. The Chicago Mercantile Exchange (CME), a prominent U.S. venue for BTC futures trading, recently expanded its product lineup by introducing futures contracts based on the ether-to-bitcoin ratio earlier this year.