- BitMEX announces futures contracts called Ethereum Quanto with a fixed multiplier in Bitcoin that will be settled in BTC.
- The contracts will combine the quanto function of the perpetual ETHUSD swap and allow their users to earn BTC without using ETH or USD.
BitMEX announced a new product that promises to be “unique in the market”. In a publication, the exchange presented the Ethereum Quanto futures contracts. These contracts will have up to 50x leverage and are available in their testnet phase. The official launch, according to BitMEX’s announcement, will be on May 5th of this year at 04:00 UTC.
A unique product based on Ethereum and Bitcoin
BitMEX also revealed that the first contract with the symbol ETHUSDM20, will be launched on the referred date, expiring on June 26, 2020 at 12:00 UTC. This will be another product that will be combined with Perpetual Contracts and futures contracts in the ETH/BTC pair on BitMEX. Since BitMEX only accepts Bitcoin (BTC) as collateral, it has had to devise new methods to offer its customers exposure to other assets. The Quanto futures contract is the financial derivative that allows this. As a result of BitMEX’s initiative to innovate in the market, the Ethereum Quanto futures contracts will have the following characteristics:
ETHUSD quanto futures have a fixed Bitcoin multiplier regardless of the USD Ethereum price. This allows traders to long or short the ETH/USD exchange rate without ever touching either ETH or USD! Traders post margin in XBT, and earn or lose Bitcoin as the ETH/USD rate changes.
On the other hand, it was announced that contract settlements will be made on the last Friday of each month, according to the BETH30M price index. According to the publication, the Ethereum Quanto futures contract will have additional features of other derivatives offered by BitMEX:
This contract combines the quanto feature of our ETHUSD perpetual swap with the expiry and settlement found in traditional futures. As with every BitMEX altcoin future, it expires quarterly.
Ethereum (ETH) has shown a positive performance in recent weeks. As it makes its transition to Ethereum 2.0, the DeFi sector is attracting the attention of investors in Asia, as Three Arrows Capital’s CEO Su Zhu said. Along with other crypto space personalities, Zhu is among those who think Ethereum is about to see a massive increase in its price. The increase will be motivated by a new investment flow and a supply shock due to the approval of the proposal that contemplates the burning of ETH with every transaction processed.
At the time of publication, Ethereum trades at $195.34 with a 4.05% gain in the last 24 hours. In the weekly and monthly charts, Ethereum shows gains of 14.28% and 42.97% respectively.
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