A First for Ethereum: Crypto Derivatives Exchange ErisX Unveils U.S. ETH Futures Product

In a historical development for Ethereum, ErisX is the first firm to introduce a compliant ether (ETH) futures product in the United States.
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In a historical development for Ethereum, ErisX — a rising cryptocurrency derivatives exchange with big backers — is the first firm to introduce a compliant ether (ETH) futures product in the United States.

For context, the U.S. Commodity Futures Trading Commission (CFTC) made waves back in 2017 in becoming the world’s first major regulator to greenlight bitcoin futures products. Since then, analysts have debated when the cryptoeconomy’s second-largest asset to date, ETH, would get its own mainstream futures offerings.

Those discussions picked up anew earlier this year when CFTC chairman Heath Tarbert predicted ETH futures were just around the corner.

“We have seen bitcoin futures, both cash-settled as well as physically-delivered … My guess is we are going to see ether futures as well,” Tarbert said at the time. Now, the debate’s officially settled.

On Monday, May 11th, ErisX, which began as a cash-settled swaps platform in 2010 before switching to crypto in 2017 and counts major companies like Cboe and TD Ameritrade among its investors, unveiled the “first U.S. based Exchange-traded Ether futures contracts” for trading.

ETH Into the Mainstream

Futures contracts are a type of derivatives product that lets investors speculate on what the price of a particular asset will be after a particular span of time. These kinds of contracts are mainstays in mainstream markets because of their ability to be used to hedge risk.

In the case of ErisX’s first ETH futures products, they will be physically-settled rather than cash-settled, meaning investors will receive ETH instead of U.S. dollars after contracts have expired. Investors can choose between “monthly and quarterly expirations.”

The release is a majorly legitimizing step forward for the Ethereum project. For one, it shows the CFTC thinks Ethereum, like Bitcoin, is mature enough to support mainstream derivatives. It also shows that a promising and rising firm like ErisX thinks Ethereum is promising and rising too.

“We are proud to bring this infrastructure to the benefit of the Ethereum network and look forward to seeing the market for ETH benefit from these risk management tools,” the ErisX team said, later adding:

“Ethereum has genuine functionality and use cases with real people, firms and governments using the network, and it’s structure has many similarities with existing commodity markets.”

The roll out notably comes after the Chicago-based ErisX earned a highly-coveted BitLicense from the New York State Department of Financial Services (NYDFS) earlier this month. Alas, the derivatives platform continues to aim big in the cryptoeconomy.

Moat at the Top of Crypto Widens

The arrival of the first ETH futures contracts is only the latest reminder that there is bitcoin and ether, and then there’s everything else when it comes to cryptocurrencies.

Of course, BTC and ETH have the most developers, the most transactions, the most adoption, the most awareness, and now the most regulatory acceptance in the U.S. It’s not that there isn’t room for more projects, rather it’s just that no one can compare to the cryptoeconomy’s top two monies across virtually any category right now.

And what’s interesting is that now it’s not just diehard proponents that agree on these fronts — it’s also the experts at the CFTC who have had to increasingly wrap theirs heads around crypto in recent years.

Their conclusion? Only BTC and ETH are worth underpinning mainstream financial products for now, which is a dynamic that speaks volumes to just how far bitcoin and ether have come in their lifetimes to date.

What seems clear for now is that more crypto futures products are coming in the years ahead. And the safest bet for now is that these products will proliferate around BTC and ETH for the foreseeable future.


William M. Peaster is a professional writer and editor who specializes in the Ethereum, Dai, and Bitcoin beats in the cryptoeconomy. He's appeared in Blockonomi, Binance Academy, Bitsonline, and more. He enjoys tracking smart contracts, DAOs, dApps, and the Lightning Network. He's learning Solidity, too! Contact him on Telegram at @wmpeaster

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