Bounded Futures - Cboe Digital

Current Products

Cash Settled Bounded Bitcoin
Cash Settled Bounded Ether

Cash Settled Bounded Futures - Not currently listed

Cboe Digital bounded futures contracts provide an innovative approach to fully funded contracts and efficiently enable short positions in crypto futures. Bounded futures are cash-collateralized and protect position holders against large price movements in the underlying markets.
Traded at and cleared through our CFTC regulated Designated Contract Market (DCM) and Derivatives Clearing Organization (DCO), our futures contracts trade alongside our spot market on an innovative and unified platform bringing price transparency and collateral efficiency.

The futures contract contains an upper boundary, against which short interest exposure is limited and therefore can be bounded and collateralized by fiat.
The contract also contains a lower boundary against which the long interest exposure is limited and therefore provides a lower capital threshold.
The contract is financially settled at contract expiry. See example below.

Contract Specifications

Description	Bounded Bitcoin Futures	Bounded Ether Futures	Bounded Ether/Bitcoin Futures
Contract Symbol	BB	BE	BEB
Contract Size	updated 0.01 BTC	1 ETH	$10,000
Price Quotation	USD per 1 Bitcoin	USD per 1 Ether	BTC equivalent of 1 ETH
Minimum Price Increment	$ 1.00 per Bitcoin ($0.01 per contract)	$ 0.10 per Ether ($0.10 per contract)	0.00001 ($0.10 per contract)
Upper and Lower Boundaries	Upper and Lower boundaries determined and set by the clearing house at time of contract listing
Collateral Reserved	Buyer: No. of Contracts * Contract Multiplier * (Trade Price - Lower) Seller: No. of Contracts * Contract Multiplier * (Upper - Trade Price)
Listed Contracts	Weekly contracts listed for 2 consecutive weeks
Settlement	Financially Settled
Last Trading Day/Time	Current hours
Last Trading Day/Time	10:00 (CT) Friday* of the expiry Week * Preceding business day if day falls on a non-business day
Block Trades	updated 100 Contracts	50 Contracts	50 Contracts
Please see the Cboe Digital Exchange Rulebook Section 11 for full details

Trade and Payout examples

We will use the example of a contract with the following parameters:

Bitcoin Bounded Future	Parameters
Current Futures Price	$ 10,000
Upper Boundary	$ 14,000
Lower Boundary	$ 7,000
Contract Size	0.01 BTC

If a trade was to be executed at $10,000 the amount of collateral withheld for each side would be calculated as:

Side	Collateral Withheld
Buyer + 100 @ 10,000	100 * 0.01 * ($10,000 - 7,000) = $ 3,000
Seller - 100 @ 10,000	100 * 0.01 * ($14,000 - 10,000) = $ 4,000

These positions for the Buyer and Seller who produce the following payouts based upon the settlement price at expiry.

Settlement Price	Buyer Theo P&L	Seller Theo P&L
$ 7,000	-$ 3,000	$ 3,000
$ 9,000	-$ 1,000	$ 1,000
$ 11,000	$ 1,000	-$ 1,000
$ 14,000	$ 4,000	-$ 4,000