Giovanni Vicioso

The launch – which represents be the first CME Group cryptocurrency options to be financially settled – is subject to regulatory approval. 

Giovanni Vicioso, CME Group global head of cryptocurrency products, said: “We are pleased to offer these new options that provide traders with even greater precision to manage short-term bitcoin price risk.

“Building on the success of our Bitcoin Friday futures, the smaller size of these contracts, along with daily expiries, offer market participants a capital-efficient toolset to effectively adjust their bitcoin exposure.”

These financially settled options complement CME Group’s existing suite of physically settled options on bitcoin, ether, micro bitcoin and micro ether futures, according to the firm.

To date, bitcoin Friday futures are CME Group’s most successful cryptocurrency product launch, with more than 775,000 contracts traded since launch and an average daily volume of 9,700 contracts.

“As a major liquidity provider in the digital asset derivatives space, we see CME Group’s introduction of options on bitcoin Friday futures as a timely, important addition to the market,” said Jason Urban, global head of trading at Galaxy.

“These contracts offer a flexible and cost-effective way for our trading desk to optimise risk management and provide tailored solutions to our counterparties navigating bitcoin price volatility.”

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The initiative will “draw from talented staff across the agency,” and specifically work for the development of the asset class, helping the Commission to “draw clear regulatory lines, provide realistic paths to registration, craft sensible disclosure frameworks, and deploy enforcement resources judiciously”. 

The initiative has been introduced by Mark Uyeda who was appointed acting SEC chair earlier this week by the new US administration, while commissioner Hester Peirce will lead the task force. 

The key factor is set to be clarity around who should register and, importantly, how. As part of the crypto task force, the SEC is set to hold roundtables for market participants.

“This undertaking will take time, patience, and much hard work. It will succeed only if the task force has input from a wide range of investors, industry participants, academics, and other interested parties,” said Peirce. 

“We look forward to working hand-in-hand with the public to foster a regulatory environment that protects investors, facilitates capital formation, fosters market integrity, and supports innovation.”

Read more:  Gensler alludes to departure from SEC 

Mark Uyeda was appointed acting chair of the SEC on 21 January by the new US administration. Speaking about his temporary role, he highlighted the important role the position plays in “promoting innovation, jobs creation, and the American Dream”. 

He added: “I am honoured to serve in this capacity after serving as a Commissioner since 2022, and a member of the staff since 2006. I have great respect for the knowledge, expertise, and experience of the agency and its people.” 

Paul Atkins was named chair of the US SEC following confirmation of Gary Gensler’s departure back in December 2023.

Atkins was initially appointed by President George W. Bush as a commissioner of the SEC on 29 July 2002, where he served until August 2008.

Uyeda will hold this office until Atkins officially assumes the position later this year.

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This year was a pivotal year for digital assets, and we’re seeing strong momentum toward adoption. More and more institutional investors – on both the buy- and sell-side – continue to be getting engaged with this technology. We also saw a lot of progress on the regulatory front, with the SEC’s approval of Ethereum and Bitcoin ETFs in the US in 2024, and the first stages of the EU’s MiCA, the first-ever blockchain-related asset regulation, coming into effect.    

We still have our work cut out for us in 2025 and beyond. While we’ve clearly proven the merits of this technology, it’s time to put real applications on the ledger using tokenisation. As we move beyond pilots and start putting projects into production, we’ll need to make sure we’re collectively driving toward an end goal: building an efficient digital market infrastructure and standards. Collaboration is the core ingredient that will help us capture the promise that digital assets hold.

In 2025, we will continue to focus on establishing the digital market infrastructure of the future, showcasing how we can deliver the same efficiencies for digital assets as we do in traditional markets today, while also ensuring smooth market operation, transparency and liquidity.

Rob Hale, head of financial markets, Lloyds Bank Corporate Markets

Digital assets look poised to gain traction in wholesale markets next year, driven not only by increased issuance but also by the transformative application of distributed ledger technology (DLT) and smart contracts. While digital asset issuance will continue to expand, the real innovation lies in how DLT and smart contracts have the ability to revolutionise collateral management, moving beyond proof-of-concept to regular market use.

In derivatives markets, collateral agreements are fundamental for managing credit risk. When two parties enter into a contract under a collateral agreement, they agree to post collateral as market movements change the exposure between the counterparties. This process, currently conducted daily, involves complex calculations, bilateral agreement, and operational execution. With trillions of dollars of collateral exchanged daily, disputes, delays, and some inefficiencies are common and can be costly.   
   
DLT and smart contracts offer a paradigm shift. By automating collateral posting, these technologies eliminate disputes through fixed valuations. More importantly, they enable intraday collateral exchanges – potentially four or more times a day – compared to the current end-of-day standard. This increased frequency would significantly enhance operational efficiency, provide instantaneous settlement, and lower the capital buffer required to cover credit exposures.   
   
The benefits are clear: fewer disputes, faster processes, and a reduced operational burden. As these technologies mature, we can expect to see them adopted more broadly, creating a more efficient, transparent, and resilient financial ecosystem. Next year may well be the year when the promise of digital assets in wholesale markets becomes a reality. 

David Mercer, chief executive, LMAX Group     

The market for digital assets is poised for exponential growth, driven by breakthroughs in blockchain technology, tokenisation and long-awaited regulatory clarity worldwide. A shift from speculative interest to real-world utility will be a core driver and the inflexion point toward mass adoption by institutional investors and corporates more broadly. The ability to tokenise assets—making trading efficient, fungible and accessible—will revolutionise markets. Fractional ownership and instantaneous transfer of title will democratise access, enabling every tier of market participant to transact seamlessly at scale. 

Stablecoins and other digital fungible collateral, backed by reputable frameworks will underpin this transformation. By acting as a bridge between fiat and digital currencies, the world’s monetary systems can become more intertwined with the broader digital assets ecosystem. To achieve this vision, systemic risks such as market concentration and regulatory uncertainties must be addressed. Doing so will encourage more innovation in this space whilst providing investor protections and enable greater participation from real money to fuel these developments.

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Next year is set to be the year of public and private collaboration for the blockchain industry, with US elections bringing greater confidence in some areas and uncertainty in others. Turning tides means the US crypto landscape is likely to look significantly different by the end of 2025. Republican control of the White House and Congress should enable much anticipated legislation, clarifying the role of regulating agencies and providing confidence, with industry innovation being supported. While DLT is still gaining traction in US financial markets, having been constrained by regulatory uncertainty, an established regulatory framework will drive tailwinds. 

Outside the US, 2024 has been a landmark year with industry collaborations illustrating the benefits DLT-based infrastructure offers. The UK RLN, led by UK Finance, involved 11 of the country’s largest banking and payments providers to create a regulated platform for public and private digital monies including CBDCs and tokenised deposits. With over 80 countries exploring CBDCs for both domestic and cross-border use cases and several in advanced stages, it’s likely more of these projects evolve into live solutions in 2025. However, uncertainty surrounding US Republican’s attitudes towards CBDCs may cause other G7 countries to put greater focus on domestic projects.

Rob Wing, head of digital assets and FX, 4OTC 

Over the past three years, we have seen more financial institutions move into digital assets trading. We expect this to continue during 2025, as investors continue to diversify their portfolios with a range of crypto assets, including Bitcoin and Ethereum. The recent US election and President Trump coming to power in January is already driving up prices in some of the more established crypto currencies.

One of the key challenges for trading firms is connecting to all the exchanges. The market remains highly fragmented, with institutional traders typically connecting to between five and 25 exchanges globally to access market data and liquidity. As crypto trading becomes more institutionalised, firms are demanding robust, secure, and low latency infrastructure, supported by failover and full disaster recovery procedures. Like the FX market, the velocity of trading is increasing, as firms analyse increasing amounts of data and quantum computing applications enable algorithmic trading, supporting complex calculations at unprecedented speeds.

Jon Light, head of OTC trading platforms, Devexperts 

We expect to see much more activity from regulators in the crypto space in 2025. With the Markets in Crypto-Assets Regulation’s (MiCA) rules starting to apply in full on 30 December, other jurisdictions will have their eye on the EU, assessing the impact of the regulation on the crypto market and responding with their own versions. The US is expected to move closer to regulating the space, adopting a more friendly stance under the Trump administration. With the SEC chairman, Gary Gensler, preparing to exit in January, pro-crypto regulation is expected. Also, the UK is getting ready to release its regulatory framework for crypto in early 2025.

These moves towards regulating the crypto space will help mitigate risks for the wider financial stability. As cryptocurrencies become more interconnected with the traditional financial sector, the challenge will be to have regulatory, global coordination, which is needed, otherwise weaker jurisdictions can be exploited. This cross-border facilitation of regulation is needed for the cryptocurrency system to continue growing and be widely adopted by institutional investors.

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GFO-X is the UK’s first regulated and centrally cleared trading venue dedicated to digital asset derivatives.

The trading venue stated that it has been working closely with these partners to deliver the requirements necessary to grow the institutional digital asset index futures and options market. 

Read more: LCH SA to launch UK’s first centrally cleared trading venue for digital asset derivatives with GFO-X

“We are delighted to announce our strategic partners as we drive towards launch in Q1 next year. Their support is a clear and strong endorsement of our vision of the market structure required to deliver digital asset derivatives to large institutional clients,” said Arnab Sen, chief executive and co-founder at GFO-X.

“It demonstrates the need for a highly regulated venue to bring additional depth, breadth, and diversification to the current limited choices in centrally cleared digital asset index derivatives. We believe the digital asset derivatives market will grow exponentially over the coming years.”

GFO-X offers a trading platform built for institutions, providing investors with a secure and efficient trading environment to manage digital asset exposure.  

“As a market maker, our strategic connection with GFO-X underscores our commitment to the institutional digital asset futures and options market – a rapidly evolving space we believe holds significant potential for continued growth and opportunity,” said Osi Lilian, IMC Strategic Investments co-lead.

The venue added that it looks forward to announcing additional partnerships with leading financial institutions in the immediate future.

Read more: M&G Investments leads $30 million Series B funding round for GFO-X

“We are excited to partner with GFO-X, the UKs first regulated and centrally cleared trading venue dedicated to digital asset derivatives,” said Barry Polak, lead product commerce at ABN ARO Clearing.

“This strategic collaboration underscores our shared commitment to advancing the institutional digital asset futures and options market.”

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The product will be available beginning 2 December and exclusively listed and traded on Cboe Options Exchange.

The options will be SEC-regulated and based on the new Cboe Bitcoin US ETF Index.

“Our new suite of options on the Cboe Bitcoin US ETF Index offers a timely and compelling solution for traders to efficiently gain exposure to spot Bitcoin,” said Rob Hocking, global head of product innovation at Cboe.

“We expect the unique benefits of cash-settlement, combined with the availability of various index sizes and FLEX options, will give customers more flexibility in their trading strategies. Our index options offer a unique value proposition that we believe will appeal to both institutional participants and retail traders alike, who are looking to capitalise on or hedge against Bitcoin’s price movements without directly holding the asset.”

Options on the Cboe Bitcoin US ETF Index means that users gain exposure to spot Bitcoin ETFs – and indirectly to Bitcoin itself.

As well as cash settlement, these index options will offer European-style exercise, exercisable only on the expiration date and eliminating the risks of early assignment.

Cboe also plans to offer Cboe Mini Bitcoin US ETF Index options, as well as cash-settled FLEX options on both the Cboe Bitcoin US ETF Index and the Cboe Mini Bitcoin US ETF Index.

Adam Inzirillo, global head of data and access solutions at Cboe, said: “This latest initiative showcases the strength of Cboe’s exchange ecosystem – from listing and trading spot Bitcoin ETFs on our US equities exchange, to generating data that drives index creation, and now launching innovative tradable products like Cboe Bitcoin US ETF Index Options.

“Our ability to leverage the full breadth of our platform to continually bring new solutions to market is a key differentiator for Cboe and a major benefit to our customers.”

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Joshua Barraclough, founder and chief executive at One Trading

This latest round saw existing investor MiddleGame Ventures increase its stake in One Trading, while Valar and SpeedInvest also participated.

The terms of the deal were not disclosed.

“As a major, multinational bank with a commitment to innovation, SC Ventures is dedicated to driving digital assets market infrastructure,” said Joshua Barraclough, founder and chief executive at One Trading.

“We welcome them as an investor in the company and believe they can add a lot of value to One Trading and our clients.”

The investment will be used by One Trading to support the launch of the first crypto perpetual futures in the EU as a Mifid II trading venue.

In July, the Dutch financial market regulator granted One Trading an Organised Trading Facility (OTF) license, establishing the exchange as a Mifid II trading venue. 

Having gained OTF License approval, One Trading is the only crypto perpetual futures trading venue in the EU and the first cash-settled perpetuals platform in Europe, including the UK.

The trading venue is also the first regulated derivatives exchange in Europe which will be accessible to retail clients. 

“Financial innovation should not come at the cost of consumer protection, that’s why we are glad to see One Trading receiving the OTF License. We congratulate the team on becoming the first Mifid II trading venue for crypto perpetual futures in the EU,” said Alex Manson, chief executive at SC Ventures. 

“We look forward to One Trading providing much needed infrastructure to all participants in the EU and further afield.”

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The move builds upon the launch of FTSE Bitcoin index futures and options last year, falling in line with Eurex’s goal to offer secure access to cryptocurrencies in a regulated market environment.

Read more: Eurex becomes first European exchange to launch Bitcoin index futures

According to the exchange, there is significant trading and hedging demand from institutional and professional customers for Ethereum, as reflected in record trading volumes in derivatives and other investment products.

“We look forward to expanding our offering in crypto derivatives together with FTSE Russell and Digital Asset Research for our clients,” said Randolf Roth, member of the Eurex executive board.

“As one of the world’s leading CCPs Eurex offers trading on a regulated exchange and is therefore the right partner to enter the crypto space for institutional clients.”

The new options and futures are listed in EUR and USD, with the respective FTSE Ethereum index as the underlying. The contract size is equivalent to 10 Ether, which is approximately $35,000.

Both of the contracts are cash settled and expire on the last Friday of each month. Monthly and quarterly maturities will be available, alongside weekly expiring contracts for options.

“We are delighted to support the expansions of Eurex’s digital assets ecosystem with the offering of futures and options on the FTSE Ethereum index,” said Kristen Mierzwa, head of digital assets at FTSE Russell, an LSEG business.

“In association with the experts at Digital Asset Research we have established an industry standard for assessing underlying digital asset and exchange inclusion. We have applied this vetting methodology to offer indices reflective of the real investable market.”

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The agreement, which aims to move beyond cryptocurrencies and bitcoin, will see the two firms provide investors with access to the $2.4 trillion digital asset landscape through manager-directed strategies.

“We believe that the digital assets landscape is so much more than the single crypto components and that crypto native companies are best equipped to understand that ecosystem and its correlation with financial markets,” said Anna Paglia, chief business officer at State Street Global Advisors.

“We are pleased to be working with Galaxy to educate investors about the role digital assets can play in a diversified portfolio and provide the opportunity to participate in the next level of growth and innovation for the digital asset ecosystem.”

With growing interest in digital assets from both institutional and retail traders as a result of spot bitcoin ETFs, investors are also seeking exposure to the asset class through investment options beyond pure spot bitcoin.

The two firms stated that they believe this is where the next level of growth is for the digital asset ecosystem.

Read more: Digital assets and traditional finance: Can two parallel lanes converge?

“Since Galaxy was founded, active management across the full ecosystem of digital assets and crypto companies has been a core competency,” said Steve Kurz, global head of asset management at Galaxy.

“By partnering with State Street Global Advisors and utilising our combined expertise, we believe we are in a strong position to make digital assets more accessible to the broader investment community through the creation of new ETFs offering exposure to digital assets.”

According to a statement, the expectation is that State Street Bank and Trust would provide administrative and accounting services for the new digital assets ETFs that State Street Global Advisors and Galaxy jointly develop pursuant to this collaboration.

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The new development builds on an existing relationship between the two firms, leveraging their combined expertise to develop new derivatives products. This could potentially start with cash-settled index options tied to the FTSE Bitcoin Index and the FTSE Ethereum Index.

As part of the collaboration, Cboe plans to list cash-settled index options on FTSE’s indices – subject to regulatory approvals – which will target increased investor demand for exchange-traded derivatives to manage crypto exposure in a US-regulated trading environment.

“Our expanded relationship today mirrors that successful model of collaboration, combining Cboe’s unrivalled derivatives expertise with FTSE’s world-class indexing capabilities to potentially bring new solutions to the digital assets space,” said Catherine Clay, global head of derivatives at Cboe.

“[…] As these two asset classes converge, we look forward to driving continued innovation and our relationship with FTSE Russell will be key to this strategy.”

The FTSE Bitcoin Index and FTSE Ethereum Index are part of the FTSE Digital Asset Indices series, developed in partnership with Digital Asset Research (DAR).

These indices capture the performance of bitcoin and ether, as determined by the FTSE DAR Reference Price, offering exposure to the digital asset market.

“We are delighted to continue working alongside Cboe Global Markets, realising our mutual commitment to enable new asset innovation in financial markets,” said Fiona Bassett, chief executive of FTSE Russell.

“Our indices are used by some of the largest crypto asset managers in the world for their best-in-class data and processes built to manage regulatory and trading risk – critical differentiators for the data in this asset class.”

Cboe added in a statement that it plans to share more details about its intentions for cash-settled index options on the FTSE Bitcoin Index and the FTSE Ethereum Index potentially later this year.

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