The second major financial instrument based on bitcoin is starting out to trade on the CME.

The CHICAGO MERCANTILE EXCHANGE Group, one of  the US's major exchanges of options and options contracts ,opened up bitcoin options contracts for trading at 6 p.m. EST Sunday. The initial price for bitcoin futuress was $20,650, and the virtual currency was trading at $20,135 at 6:08 p.m. EST.

The crypto currency has boomed in popularity and value this year even while drawing problems regarding its unpredictability.

The CME bitcoin futures contracts, like the bitcoin futures that now trade on the Chicago Board Options Exchange, do not need actual bitcoin. They will reflect an index of bitcoin price. Each contract will be for 5 bitcoin.  

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The CME's futures contracts are cash-settled contracts based on the CME CF Bitcoin Reference Rate (BRR) and the CME CF Bitcoin Real Time Index (BRTI).

The average daily trading volume the month after CME joined was six times larger than when only the CBOE offered the derivatives. The Futures Industry Association has criticised the US regulator's approval of bitcoin futures. For comparison, the Chicago Mercantile Exchange (CME), which launched Bitcoin futures products during the same period, depends on the so-called Bitcoin Reference Rate. 

CFDs are derivatives products that allow you to trade on live market price movements without actually owning the underlying instrument on what your contract is reliant.

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