CME Group is set to roll out its own Bitcoin ‎futures trading Monday morning, under the ticker BTC, a week after the rival‎ Cboe launched the first-ever cryptocurrency derivative listed on a major exchange over ‎the weekend.‎

In its latest update on the matter, the exchange announced today that the ‎initial margin requirements‎ – the amount an investor has to set aside as ‎collateral for potential losses – have been increased from 36% to 47%. Due ‎to Bitcoin’s recent extreme volatility, the figure is several times greater than ‎that of typical futures contracts‎ like gold and oil. It should be noted, however, that ‎the brokerage firms offering the product may apply higher margin rates. For ‎example, Interactive Brokers offers trading of CFE futures, but with a much-higher ‎‎50 percent margin requirement. ‎

Bitcoin continues a tumultuous trading week, with the digital ‎coin prices dropping from heights of near $20,000 to $13,500, ‎before stabilizing at around $14,500. The recent swings have ‎brought worries of what effect bitcoin volatility ‎will have on ‎futures trading.‎

Things you should know about XBT

As market manipulation believed to be rife in ‎the barely regulated crypto market, ‎ the CME ‎is enforcing a number of safeguards,‎ ‎also known as circuit breakers. This will include halting trading if the price swings ‎more than ‎7%, 13%, and 20% from the futures fixing price.‎

Moreover, XBT futures contracts are cash settled based on a U.S.-dollar-‎denominated auction price set by crypto exchange and custodian ‎Gemini. This means investors will receive their final payment in cash rather ‎than bitcoin. That also means that the Chicago-based exchange owner doesn’t have to deal with the ‎headache of setting up its own bitcoin wallet‏.‏‎ ‎

The CME currently lists monthly contracts for the nearest two months in the ‎March quarterly ‎cycle plus the nearest two serial months not in the cycle‎. The final settlement value of the contracts will be determined by ‎the price of a bitcoin index currently made up of prices in Bitstamp, GDAX, itBit and ‎Kraken. ‎Each contract will equal five bitcoins.‎

The introduction of bitcoin derivatives is an important step toward the development ‎of the digital coin as a more established asset class, bringing with it mainstream ‎‎recognition through association with highly-regulated ‎bourses. ‎Nevertheless, doubters remain concerned over potential market ‎manipulation of Bitcoin’s price despite the protections already set ‎in place.‎