Eurex will launch Bitcoin index futures as CME Group’s suite of cryptocurrency futures had their best trading day of the year on March 13.

Deutsche Börse’s derivatives arm said in a statement that it is the first European exchange to offer Bitcoin index futures, which are due to start trading on 17 April 2023. Eurex described the launch as a major milestone in its ambition to offer safe and trusted access to cryptocurrencies in a regulated market environment.

The new contract complements Eurex’s already listed BTCetc ETN Futures with physical delivery and has been developed in partnership with FTSE Russell, London Stock Exchange Group’s index business, and Digital Asset Research, a provider of institutional-grade digital asset data.

Arne Staal, chief executive of FTSE Russell, said in a statement: “Our digital asset indices apply the same rigorous index policy and governance framework used with our equity and fixed income products. Perhaps most importantly in this market, in collaboration with DAR, we have created a vetting methodology to set a standard for digital asset and exchange index inclusion, that offers consistent prices reflective of the real investable market to the investor community.”

The launch comes as cryptocurrency prices have rallied, and US exchange group CME Group had the best trading day this year for its suite of cryptocurrency futures.

As cryptocurrency prices rallied, CME Group's suite of Cryptocurrency futures had their best trading day of the year on March 13. Trading volume exceeded 90,500 contracts, representing over $4.6 billion in notional value. https://t.co/rBlNL3rgTP pic.twitter.com/F6EPd8GmUZ

— CME Group (@CMEGroup) March 15, 2023

Counterparty risk is a key concern for market participants according to the latest Acuiti Crypto Derivatives Management Insight Report. This quarter’s report is based on a survey of the Acuiti Crypto Derivatives Expert Network, a group of over 70 senior executives from asset managers, hedge funds, sell-side firms, and proprietary trading groups active in trading crypto derivatives.

Nearly half of the network, 47%, said they they were very concerned with counterparty risk compared with 31% for operational risk, 13% for liquidity risk and just 6% for market risk. The report also found that three quarters of the network were either quite or very optimistic for a recovery in digital assets markets over the next three months.

Will Mitting, founder of Acuiti, said in a statement: “This quarter’s report demonstrates the resilience of the crypto derivatives market as it recovers from an immensely challenging year.”

Record trading volumes

Increased volatility following the recent failures of Silicon Valley Bank and Signature Bank in the US have led to record trading volumes on exchanges.

On 13 March 2023 CME Group reported its highest daily volume on record, with 66.2m contracts traded.

Just in: CME Group hits daily trading volume record of more than 66 million contracts, driven by Interest Rate and Equity Index complexes. https://t.co/rOKFskoX93

— CME Group (@CMEGroup) March 14, 2023

Terry Duffy, chairman and chief executive of CME Group, said in a statement: “The importance of risk management cannot be overstated. Our futures and options on futures products are doing what they were designed to do, as investors seek to protect their portfolios amid heightened volatility.”

CME also reached the following daily records across its interest rate and equity index complexes on March 13:

• Record interest rate futures and options volume of 41,904,908 contracts
• Record SOFR futures volume of 15,548,464 contracts
• Record SOFR options volume of 5,974,351 contracts
• Record 30 Day Fed Funds futures volume of 2,258,410 contracts
• Record equity index futures and options volume of 17,805,973 contracts
• Record micro E-Mini S&P 500 futures volume of 2,895,971 contracts
• Record E-Mini Russell 2000 futures volume of 1,053,544 contracts
• Record micro E-Mini Dow Jones futures of 607,411 contracts

On 13 March 2023 Intercontinental Exchange also had  record levels of trading activity with 14.45m futures and options contracts traded during the day. This beat the previous record set on 12 March 2020 as the market reacted to the onset of the COVID-19 pandemic.

ICE said the financials futures and options portfolio reached a record, with a record 10 million contracts traded in comparison to average daily volume in 2023 of three million contracts

Euribor, the benchmark contract for managing short term Euro related interest rate risk, had a record 5.49m futures and options contracts traded, surpassing the record previously set on 29 May 2018. SONIA, the benchmark contract for UK interest rate risk, also saw a record 1.17m futures and options contracts traded.

Chris Rhodes, president of ICE Futures Europe, said in a statement: “The record level of trading activity which took place on ICE’s markets on March 13 reflects a sudden change in risk sentiment in U.S. regional bank stocks, which collided with interest rate expectations that were priced for central bank tightening. These volumes reflect a flight to liquidity, demonstrating the reliability of futures markets as a risk management tool.”

ICE’s equity indices portfolio also reached a record 2.9m futures and options contracts traded on 13 March 2023, compared to ADV of 423,000 contracts.

New York Stock Exchange, also owned by ICE, also reported that full-day NYSE volume and the Closing Auction both set records on 17 March 2023.

Record Check ☑️
On Friday, the full-day NYSE volume was a record at 4.1bn total shares.
The NYSE Closing Auction also set a new all-time volume record on Friday’s rebalance, trading more than 2.7bn shares. pic.twitter.com/D1RxvoJq2p

— NYSE ? (@NYSE) March 20, 2023

Michael Reinking, senior market strategist at NYSE, said in a report that it was expected that volumes would be very heavy  on 17 March due to the quad-witch expiration and the quarterly index rebalance.

“It was a record breaking day with 4.1 bn shares trading on the NYSE,” added Reinking. “The closing auction was also the largest in history with 2.72bn shares trading, 12% above the previous record in December of 2021.”