Cryptocurrency exchange operator Kraken will be the key supplier of market data for CME Group’s reference and real-time bitcoin price indices being launched later this year. CME is currently the joint operator of the S&P 500 and Dow Jones Industrial Average and one of the world’s largest options and futures exchanges.
Kraken’s market data was previously recognized as a reliable standard in 2014, when it became the first bitcoin exchange to provide complete price and volume data to the Bloomberg Terminal.
CME Group, in collaboration with Crypto Facilities Ltd, will launch the CME CF Bitcoin Reference Rate (BRR) and the CME CF Bitcoin Real Time Index (RTI) in the fourth quarter of 2016, a significant step in the developing use of cryptocurrency in the derivative market.
CEO of Kraken, Jesse Powell, said his company is perfectly equipped to furnish the CME CF BRR and RTI immediately upon roll-out.
“We are proud to provide accurate, reliable, real-time data for the world’s leading derivatives marketplace. It is critical for traders to have a fully credible and reliable reference rate source around the clock, and Kraken is proud to provide our data.”
CME Group’s BRR will aggregate the trade flow of major bitcoin spot exchanges during a specific calculation window into a once-a-day, transparent reference rate of the US dollar price of bitcoin.
The RTI will be calculated by Crypto Facilities and will be based on global demand to buy and sell bitcoin aggregated into a consolidated order book. It will reflect the current market price of bitcoin in US dollar terms and will be published approximately once every second.
Kraken recently received a Series B investment from leading Japanese foreign exchange brokerage Money Partners Group, who are listed on the 1st Section of the Tokyo Stock Exchange. According to the company, Kraken this year has seen new customer accounts quadruple, a ten-fold increase in bitcoin/USD trading, a thirty-fold increase in bitcoin/CAD trading, and a fifteen-fold increase in bitcoin/JPY trading.
Crypto Facilities is a London-based financial services firm that provides risk management and trading solutions around digital assets. The firm’s management has extensive financial markets expertise from top investment banks, with focus on compliance, reporting and risk management across its services and solutions.