On March 17, the CME Group plans to introduce Solana futures on its trading platform, which may lead to the issuance of an ETF.
On March 17, the CME group plans to introduce Solana (SOL) futures on its derivatives marketplace. This is important because it may make it easier for the Solana ETFs to be approved.
CME Group To introduce Solana Futures
The top derivatives marketplace in the world, the CME group, stated in a press release that, pending regulatory approval, it intends to introduce Solana (SOL) futures on March 17. Micro-sized contracts (25 SOL) and larger-sized contracts (500 SOL) will be available for trading by market participants.
Giovanni Vicioso, the Global Head of Cryptocurrency at the CME Group, commented on this development:
We are responding to growing customer demand for a broader range of regulated products to manage cryptocurrency price risk by introducing our new SOL futures contracts. These new futures contracts will offer developers and investors a capital-efficient tool to support their investment and hedging strategies as Solana develops into their preferred platform.
The announcement states that the CME CF Solana-Dollar Reference Rate, which acts as a reference rate of the Solana price in USD, will be the basis for the cash-settled SOL futures. In addition to Bitcoin and Ethereum, Solana will be the third cryptocurrency on the derivatives platform.
Importance Of SOL Futures Launch
The introduction of the Sol futures by the CME Group is noteworthy because it may open the door for the US SEC to accept the applications for SOL ETFs that are still pending. Nate Geraci, the president of the ETF store, commented on this development and affirmed that the launch of the Solana futures “bodes well” for the prospects of the SOL ETF.
Under Gary Gensler, the SEC had previously maintained that the market easily manipulates cryptocurrency exchange-traded funds (ETFs). Nonetheless, the court determined that there is a correlation between the futures and spot markets in Grayscale’s case against the Commission. The Commission has no justification for rejecting a Solana spot ETF if the SOL futures market opens.
Franklin Templeton, an asset manager, recently submitted its Solana ETF S-1. Other companies offer an SOL ETF, including VanEck, Bitwise, Canary Capital, 21Shares, and Grayscale.
As a result of this development, the price of Solana increased, and the support level recovered to $140. Since launching SOL futures would increase liquidity in the Solana ecosystem, its price is bullish.
After the recent crash in the cryptocurrency market, the price of Solana had fallen below $130. Ali Martinez, a cryptocurrency analyst, cautioned that SOL bulls need to protect the $125 support level, or else the price could fall as low as $60.
