In the realm of digital currencies, transparency and accuracy are key. With the rapid growth of the cryptocurrency market, there’s an increasing demand from global financial institutions and investors for reliable and transparent cryptocurrency reference rates. To meet this demand, two financial powerhouses, CME Group and CF Benchmarks, recently announced their latest collaboration.
A Globalized Cryptocurrency Market
On August 16, 2023, the two companies announced plans to roll out two APAC-specific reference rates for Bitcoin and Ethereum on September 11: the CME CF Bitcoin Reference Rate APAC (BRRAP) and the CME CF Ether-Dollar Reference Rate APAC (ETHUSD_AP). These rates will be published daily at 4 p.m. Hong Kong/Singapore time, providing a USD price point for these two digital assets to global market participants.
So, what’s the big deal behind this move?
First off, it signifies the globalization and diversification of the cryptocurrency market. With advancements in technology and the trend towards globalization, digital currencies have truly become a global market. Giovanni Vicioso, Global Head of Cryptocurrency Products at CME Group, mentioned that these new reference rates aim to cater to the ever-growing needs of global participants in the digital asset space. He also pointed out that, to date, 37% of CME Group’s crypto trading volume occurred outside U.S. hours, with 11% coming from the APAC region.
More Choices for Market Participants
Next, these non-tradable reference rates will complement the existing CME CF Bitcoin Reference Rate (BRR) and CME CF-Ether Dollar Reference Rate (ETHUSD_RR), as well as the recently introduced CME CF Bitcoin Reference Rate New York (BRRNY) and CME CF Ether-Dollar Reference Rate New York (ETHUSD_NY). This means that no matter where you are or what time zone you’re in, you can access accurate and reliable cryptocurrency reference rates.
Financial Institutions’ Confidence in the Cryptocurrency Market
Lastly, this collaboration also showcases the confidence of financial institutions in the cryptocurrency market. Sui Chung, CEO of CF Benchmarks, expressed his delight in assisting financial institutions in offering regulated financial products to Asian markets. This not only proves the maturity of the cryptocurrency market but also highlights its significance in the global financial arena.
Conclusion
All in all, the collaboration between CME Group and CF Benchmarks not only offers more choices to global market participants but also lays a solid foundation for the future growth of the cryptocurrency market. With more financial institutions and investors diving into this market, we can expect a steady growth of cryptocurrencies in the coming years.