XRP Futures Set to Launch on CME Group, Boosting Liquidity and ETF Chances

The CME is launching futures trading on XRP on May 19, pending regulatory review. It will allow both micro and large contracts, from 2,500 to 50,000 XRP, prioritizing flexibility and precision.

This development could provide several key advantages for the asset. In addition to substantial liquidity, the CME will treat the asset as a commodity like Bitcoin and Ethereum. This could potentially boost the chances of an XRP ETF approval.

CME to Launch XRP Futures

XRP futures are financial contracts that let traders speculate on the future price of XRP without owning the actual XRP coins. It will allow institutional and professional traders to hedge risk or speculate on XRP prices using regulated instruments.

CME’s involvement is significant—it’s the world’s largest derivatives exchange, and adding XRP gives more legitimacy and market depth.

The CME has been interested in crypto futures trading over the past few months. It hinted at launching Solana and XRP futures in January but couldn’t officially commit to the strategy until approval.

The CME first began Solana futures trading last month and is set to open XRP futures on May 19:

“While overdue in a bunch of ways, this is an incredibly important and exciting step in the continued growth of the XRP market!” Ripple CEO Brad Garlinghouse claimed via social media.

Meanwhile, futures trading in the institutional market could potentially aid the chances of an XRP ETF. Additionally, it potentially opens a huge window of new liquidity for the token. The recognition of CME’s brand will guarantee product quality in the eyes of institutional investors.

Coinbase added XRP futures trading earlier this week after receiving official CFTC approval. The CME is also a CFTC-regulated institution, but it will take a few weeks to offer its own XRP futures.

Still, it began offering Bitcoin and Ethereum futures this year, and this development suggests it’s treating Ripple’s altcoin like a commodity, too.

The announcement acknowledges that it still requires regulatory approval, possibly explaining the long wait. These futures will be cash-settled and based on the CME’s XRP-Dollar reference rate, which is calculated daily.

XRP’s demand hit a five-month low this week, and the CME won’t offer futures for nearly a month. This news is undoubtedly bullish, but it may take some time to materialize fully in the market.