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A new way to bet on Bitcoin is about to go live when futures of the cryptocurrency begin trading in a few hours. The first bitcoin future <0#XBT:> trades are set to kick off at 6 p.m. EST (2300 GMT) on CBOE Global Markets Inc’s (CBOE.O) CBOE Futures Exchange.
Earlier today, Bitcoin prices dropped to as low as $13,000 but soon rebounded back to $15,000 levels. At the time of writing the cryptocurrency is trading at $15,850 on GDAX, posting a market cap of $261 billion.
In a nutshell, the futures are cash-settled contracts based on the auction price of bitcoin in U.S. dollars on the Gemini Exchange, which is owned and operated by Winklevoss brothers.
Bitcoin fans look excited at the prospect of an exchange-listed and regulated product and the ability to bet on its price swings without having to sign up for a digital wallet. However, there are others who are afraid that risks remain for investors and possibly even the clearing organizations underpinning the trades.
It is unclear, how many clearing members will allow their clients to trade Bitcoin futures and what margins they will require. There is a good chance that volumes will actually be small to start and that there will be more sellers of the contract than buyers as it seems like a good way to monetize recent price appreciation.
The Financial Times reported saying that the big US banks, including JP Morgan Chase and Citigroup, will not immediately clear Bitcoin trades for clients. Goldman Sachs, on the other hand, said it was planning to clear Bitcoin futures for certain clients.
Only the time will tell how the prices will react to futures launch. Even if the prices go down, people who have been in this industry know very they will eventually bounce back up to register all-time highs.
Happy Bitcoin futures to all. Good luck trading.
Top Stories from the Crypto World
1. Winklevoss twins expect Bitcoin market cap to surpass trillions in long-term
Tyler and Cameron Winklevoss, twins behind Gemini exchange and famously known for coming up with the Facebook idea, explained that the properties of Bitcoin allow it to operate as a premier store of value that is in orders of magnitude better than gold in many aspects, including transportability, divisibility, and monetary supply.
“We’ve always felt that bitcoin, given its properties, is gold 2.0 — it disrupts gold. Gold is scarce, bitcoin is actually fixed. Bitcoin is way more portable and way more divisible,” said Winklevoss.
Cameron further added that if Bitcoin can continue to disrupt the $6 trillion gold market in the long-term, it will be able to hit a trillion dollars in a relatively short period of time, given that the market valuation of Bitcoin already remains close to $300 billion.
2. Bitcoin community raises over $1.6 million for Andreas Antonopoulos
On December 5, Roger Ver publicly stated that if Antonopoulos had invested $300 in 2012, he’d be a millionaire today. In response, Antonopoulos explained that he had sold Bitcoin he owned to pay his rent, given that he had worked for two consecutive years without pay and disposable income.
Ver’s statement made the Bitcoin community to come together and make Andreas a millionaire. Within 48 hours, the community raised more than $1.6 million for him. One lady gave Andreas 37 Bitcoin in one go.
“Dozens of people supported me back then, many from the bitcoin community. Roger himself helped me get my first paying work in bitcoin. Let’s keep things respectful,” said Antonopoulos.
His wallet address for the curious: https://blockchain.info/address/1andreas3batLhQa2FawWjeyjCqyBzypd
3. Bitcoin crash among 2018 financial worries, according to Deutsche Bank
According to Deutsche Bank Chief International Economist Torsten Slok, the major risks for the global economy in 2018 include a crash of Bitcoin.
Slok sees huge potential for volatility in the price of the cryptocurrency, as do other economists, and has indicated that the price may even see huge changes before the close of the current year. His main concerns include regulation, transparency, and disclosure, as well as volatility drifting into the overall market.
He said, “It’s mainly because it (Bitcoin price volatility) is something that I think financial markets so far have been discounting as a small issue. We do worry a bit that it could become more systematic, in particular, if the current trends continue into 2018.”