Major US Financial Deals Discard Bitcoin Futures
Last year, the CME legacy exchange group provided a bitcoin price index with the intent of adding bitcoin futures. However, they decided not to follow through with those plans.
Bryan Durkin, who runs the Chicago company, told Bloomberg they were not going to list bitcoin futures. He mentioned the technology is nascent, and that digitization technology is on their radar. He further stated, “I really don’t see us going forward with a futures contract in the very near future.” However, some investors want exposure to bitcoin. There is a market for indirect exposure via futures contracts.
Although CME will not offer future pairings to its customers, some of its competitors are entering the futures markets. Chicago, CBOE Holdings Inc., is slated to add futures contracting for bitcoin to their platform. They plan on implementing futures contracts in the fourth quarter of next year, according to the Bloomberg article. CBOE formed an alliance with the Winklevoss venture Gemini Trust Co in order to bring clients these bitcoin future options.
Outside the United States, other companies have tried their hands at offering bitcoin futures. Straits, a Singapore based company, introduced futures trading last year. Straits partnered with Bitpay to make the transition seamless.
The growing introduction of futures markets signifies that investors and traders want more exposure to bitcoin on legacy financial exchanges.
Ed Tilly, CBOE’s chairman and CEO, emphasized investor demand as the catalyst for the introduction of futures markes. He said in a comment that people want exposure and contact with bitcoin.
However, investors still seem reluctant to have bitcoin directly. Instead, they prefer hedges against any perceived volatility with contractual arrangements. However, more and more traders are embracing bitcoin head on, with the price recently breaking the $4,000 barrier once again. This means that many investors still enjoy holding and trading bitcoin of their own. Nonetheless, it will be interesting to see how many more legacy financial exchanges draft futures contracts for their clientele as bitcoin adoption increases.
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