CME Group plans to roll out a tokenised cash product this year that could be used as collateral in crypto and derivatives markets, according to chief executive Terrence Duffy.
Duffy said on an earnings call that CME is developing its “own coin” that could be placed on a decentralised network for use by industry participants, following regulatory moves allowing crypto as collateral.
“On the tokens and what we would accept going forward, all depends on who is issuing the token and giving it to us,”
Duffy said.
The initiative follows a pilot by the US Commodity Futures Trading Commission allowing assets such as USDC, bitcoin and ether to be used as derivatives collateral, expanding the scope of acceptable margin.
CME, the world’s largest derivatives exchange, has steadily expanded into crypto by launching futures tied to bitcoin, ether, Solana and XRP.
The tokenised cash product is being developed alongside Google Cloud and would be supported by a depository bank to facilitate settlement and margin transactions.
Duffy said CME is also evaluating other forms of on-chain collateral, including stablecoins and tokenised money market funds, while stressing the firm will avoid taking risks it cannot properly assess.
At the time of reporting, Bitcoin price was $72,967.69.