CME Group failure halts cryptocurrency futures and other derivatives trading

Source: CritpoTendencia Original Title: Operations at CME Group halted due to a data center failure Original Link: Options and futures trading operations at the Chicago Mercantile Exchange (CME Group) were suspended this Friday. The cause was a failure in a data center upon which the group's electronic trading platform, Globex, relies. This affects areas such as the Forex market, stocks, bonds, cryptocurrencies, and commodities.

According to reports from specialized media, this interruption is similar to the one that occurred in 2019, which lasted for hours due to a technical failure. Now, a new interruption is causing frustration among operators due to the prospect of a lost day of activities.

This exchange is one of the most important in the world in the field of derivatives. In fact, millions of contracts that track the S&P 500, Dow Jones, and Nasdaq 100 are traded every week. These are traded in an “around the clock” mode on the mentioned exchange.

According to a spokesperson for CME Group, the suspension of operations is related to cooling issues at the CyrusOne data centers, a key provider for this exchange. The representative did not provide an estimated timeline for the resumption of activities.

Among the affected areas is also the futures trading of United States Treasury bonds. It is worth mentioning that bonds from other markets, such as the European one, were not affected, as they are traded on different platforms.

The CME Group Suspension Causes Confusion Among Traders

According to consulted experts, for operators with open positions this is an uncomfortable situation. However, they emphasize that the confusion of the moment has surely not stopped others, who are taking their capital to alternative platforms. The truth of the matter is that a huge mass of liquidity is evaporating as a consequence of the failure.

“We have lost one of the largest sources of market liquidity. This increases the risk of exaggerated movements in the event of a significant occurrence,” warns Nick Twidale of AT Global Markets. One of the factors adding pressure is that most U.S. markets were closed on Thursday due to Thanksgiving.

This last point increases the desperation of traders in the face of the thirst for trading activity. From an optimistic perspective, no major economic announcements are expected in the United States by Friday. Likewise, there will be no statements from members of the Federal Reserve due to the usual information blackout that precedes monetary policy meetings.

The temporary halt of operations at CME Group particularly affects the world of cryptocurrencies. It is worth noting that numerous contracts based on Bitcoin, Ethereum, Solana, and other important tokens are opened daily on that platform.

As is well known, the crypto world has a liquidity that is much lower compared to other markets. This makes the suspension of the CME a much more delicate issue for virtual currencies.