CME’s Ether Futures Record Highest Ever Open Interest of 383K ETH After ETF Debut

Activity in Chicago Mercantile Exchange’s (CME) ether (ETH) futures reached new heights on Tuesday as the debut of spot ETH exchange-traded funds (ETFs) in the U.S. galvanized investor interest in the second-largest cryptocurrency.

The so-called open interest or the number of active bets in standard ether futures rose to a record of 7,661 contracts, equaling 383,650 ETH and $1.4 billion in notional terms, the exchange said in an email to CoinDesk. The previous peak of 7,550 contracts was set one month ago. The standard contract is sized at 50 ETH.

Speaking of trading volumes, the derivatives giant witnessed 14,736 contracts change hands on Tuesday, which is three times higher than the average daily volume of 5,010 contracts seen throughout July. Tuesday was also one of the top 10 volume days for ether futures.

Giovanni Vicioso, global head of cryptocurrency products at CME Group, attributed the surge in activity to the onset of spot ether ETF trading in the U.S.

“The approval and subsequent trading of spot ether ETFs in the U.S. has reinvigorated the market, driving significant growth in volume across our Ether suite and leading to record open interest for our flagship Ether futures,” Vicioso said in the email.

“As more and more traders seek exposure to cryptocurrencies, our suite of regulated, reliable and deeply liquid bitcoin and ether futures products continue to provide transparent tools for managing risk and capitalizing on market opportunities,” Vicioso added.

Spot ETFs hold ether, meaning investors in the fund have exposure to the actual cryptocurrency rather than derivatives tied to the digital asset. The ETFs are widely expected to pull billions of dollars worth of investor money in the coming months.

These funds can be used to take both directional and non-directional arbitrage bets, such as carry trades, as observed in the bitcoin market. Besides, authorized participants tasked with creating and redeeming ETF shares are said to use regulated products like CME futures to hedge their exposure.