You have successfully emailed the post. 1 quadrillion annually, is set to roll out bitcoin futures by the fourth quarter. A bitcoin future will allow investors to bet on the future price of bitcoin without having to actually hold the coin itself. It could bring more Wall Street firms into bitcoin bitcoin 2 you other cryptocurrencies.
Just when you thought you finally got your head around bitcoin, along comes a new bitcoin-linked financial product: bitcoin futures. Last year CME launched a bitcoin index CME CF Bitcoin Reference Rate. The bitcoin futures will be based off of this rate. Cboe has long had a plan for bitcoin futures in the works, and is also preparing for a possible Q4 launch. That epic rise has gripped the attention of Wall Street and Main Street alike. The development of bitcoin futures is the latest chapter in a broader story about cryptocurrencies gaining traction among traditional players in financial services. Here’s a quick explainer of bitcoin futures and why they could be a big deal for Wall Street and bitcoin.
Futures, which allow two parties to exchange an asset at a specified price at an agreed upon date in the future, have been around since the late 19th century. They are traditionally traded by professional investors and firms. CME trades futures based on everything from oil to corn. The latter are referred to as cash settled futures.
For instance, an investor can buy a future for a commodity like oil betting that its price goes up at a certain point in time. 50 right now, and the investor thinks the price is going to go higher. What would a bitcoin future look like? Both Cboe and CME have said that their bitcoin futures products would settle in cash. And that’s exactly what makes the possible market so appealing to Wall Street. Firms who buy or sell bitcoin futures don’t have to worry about actually holding the cryptocurrency itself.
In a way, bitcoin futures would be similar to other futures traded on Wall Street, according to Bank of America Merril Lynch. John Deters, chief strategy officer of Cboe, highlighted this feature of the product in a recent interview with Business Insider. People will be able to settle in cash,” Deters said. So you can take a speculative position without touching bitcoin itself, which helps make it more attractive to all sorts of folks. You can take a speculative position without touching bitcoin itself, which helps make it more attractive to all sorts of folks.
There are a number of reasons why bitcoin futures products would be a big deal for Wall Street and the world of crypto. The CME announcement provides the first step in legitimizing the ever-growing crypto space as a true financial asset,” Dave Johnson, the CEO of Latium, a cryptocurrency technology company, told Business Insider. And other firms are likely to jump on the bandwagon as well. Futures could also help dampen volatility in the underlying bitcoin market, which is known for its wild price swings. We would not overstate this, as a material reduction in volatility would require there to be a large community of speculators prepared to provide liquidity to the natural owners of the various coins, but given the volatility of the coin markets, maybe there already exists a cadre of participants who would look to short coins on strong days and vice versa, which could overall reduce volatility. Get the latest Bitcoin price here. 10-day moving average would abort bitcoin’s short-term bullish view.
It’s been a standoff between the bitcoin bulls and bears over the past few days, but the bulls might getting ready to take charge. Binance announced today that it has appointed Helen Hai as the new head of its charity foundation. BTC is showing signs of exhaustion near a key resistance zone, still, the short-term outlook remains bullish. Public filings released in late May establish the strongest link yet between Bitstamp and Korean gaming firm Nexon. Snoozers always lose in the crypto market. This guide to the RSI indicator will help you in making timely trades and hopefully walk away with a win. Crypto exchange Gemini has hired former NYSE chief information officer Robert Cornish to serve as its first chief technology officer.