BitMEX to launch a new futures product

A major crypto derivatives exchange, BitMEX, recently announced the launch of a new futures product. The exchange revealed that it plans to start offering ETH/USD futures, which settle in Bitcoin. The product is only around 10 days away from seeing launch on May 5th.

ETH/USD futures contracts about to arrive

Naturally, the new contracts will allow traders to speculate on the price of Ethereum. Bullish traders would buy more contracts, while bearish one can sell them. The contracts will have 50x leverage, and they will require margin in order to be posted in BTC.

In other words, only BTC will allow traders to go long or short on the new futures contracts.

The futures also have a fixed bitcoin multiplier, and sits at 0.000001 bitcoin per $1. In other words, the contract would pay out this amount of BTC per USD no matter how much the price of Ethereum in USD is.

As a result, traders can choose to go long or short without the need to ever even touch USD or ETH. They can do everything with BTC. BitMEX also says that the first contract will expire in June,

Of course, it should be mentioned that BitMEX already has perpetual contracts and futures contracts for Ethereum. However, the futures contracts allow traders to speculate on the value of ETH against BTC, while the perpetual contracts have no settlement.

The new product will provide users with ETH/USD pair, which will allow traders to benefit from a different exchange rate.

Crypto sector still suffers from a price crash

BitMEX's new product comes at an interesting time for cryptocurrencies. The Black Thursday — the event that knocked down BTC price by over 50% in a single day — is still fresh in traders' memories. On the other hand, Bitcoin halving is rapidly approaching, now being only a few weeks away.

While many expect BTC price to grow due to the halving, no one can predict when it might happen. Historically, traders are in for an 11-months-long delay before the price starts surging. On the other hand, the fact that BTC is well-known throughout the world this time might mean that the surge will come early.

Naturally, there are those who think that it won't come at all. So, exchanges like BitMEX are facing liquidations due to the past drop, and the uncertain future of the coin is certainly not helping at this time. But, futures contracts do not require ownership of any actual crypto, only betting on its price, which is why BitMEX's move does make sense.