Launched in 1981, Eurodollars were the first cash-settled futures contract and became the backbone of short-term rate trading. They settled to three-month US dollar LIBOR, were listed ten years out, and at their peak carried more open interest than any other contract on earth.
The LIBOR manipulation scandals ended the underlying benchmark. Contracts were converted to sofr-futures with a fixed spread adjustment of 26.161 basis points, completing in 2023. The name survives in trader slang and in older literature, where "the reds", "the greens" and "the blues" referred to the second, third and fourth years of the strip.
Example: converting a Eurodollar position at 95.50 (4.50% LIBOR) produced a SOFR position at 95.7616, since SOFR is a secured rate roughly 26 basis points below LIBOR. Position size and $25 per basis point value were unchanged.
Related: sofr-futures, strip-trade, fed-funds-futures, cash-settlement, federal-funds-rate