How Is the Final Settlement Price Determined for a Cash-Settled Contract?

The final settlement price is determined by referencing a specific, pre-defined benchmark or index on the contract's expiration date. This reference rate is typically an average of prices from various reputable spot markets during a defined settlement window.

For cryptocurrency futures, this is often a calculated index like the CME CF Bitcoin Reference Rate (BRR). This ensures transparency and prevents manipulation of the final price.