CME Weighs Blockchain-Based Coin for Market Infrastructure

• CME Group explores a proprietary “CME Coin” for tokenized collateral and margin systems.
• CME CEO Terry Duffy says issuer trust is key, exploring a CME token on a decentralized network.
• CME’s token initiative is separate from its Google-backed tokenized cash project and crypto futures.

Wall Street derivatives heavyweight CME Group is considering the launch of a proprietary digital asset, informally described as “CME Coin,” as part of its broader work on tokenized collateral and blockchain-based market infrastructure. The disclosure came during the company’s latest earnings call, where senior leadership outlined how digital tokens could fit into future margin and settlement processes.

During the call, CME Group Chief Executive Officer Terry Duffy responded to a question from Morgan Stanley analyst Michael Cyprys about tokenized collateral. Duffy said the exchange is actively evaluating different forms of margin and collateral, including tokenized cash and the possibility of issuing a CME-backed token.

Duffy noted that counterparty trust plays a central role in how collateral is assessed. He explained that a token issued by a systemically important financial institution could offer more comfort in margin use than one issued by a smaller or less established bank. Within that context, he confirmed CME is examining “initiatives with our own coin” that could potentially operate on a decentralized network.

Separate From Google Tokenized Cash Project

CME Group is already collaborating with Google on a tokenized cash solution scheduled to launch later this year. That project will involve a depository bank and is designed to facilitate cash-like transactions using blockchain infrastructure.

According to Duffy, the internally discussed CME Coin would be a separate initiative and could be made available to other industry participants on a decentralized network. When asked for clarification, CME declined to specify whether the proposed coin would function as a stablecoin, a settlement token, or another form of digital asset.

Broader Crypto Market Expansion Underway

The comments are the first time CME Group has publicly raised the possibility of issuing its own blockchain-based asset. The exchange has previously identified tokenization as a strategic area of interest, but had not tied that focus to a proprietary token.

CME is also expanding its crypto derivatives business. The exchange plans to introduce 24/7 trading for all crypto futures in the second quarter of the year and is preparing to list futures contracts tied to Cardano, Chainlink, and Stellar. Last year, CME reported average daily crypto trading volumes of about $12 billion, with micro-bitcoin and micro-ether contracts among its most active products.

Related:CME Group to Launch Cardano, Chainlink, and Stellar Crypto Futures