Bitcoin Futures Begin Trading on Securities Exchanges

During the last couple of weeks, there’s been a lot of talk over bitcoin futures and how these trading instruments will change up the market. Now, that a few futures exchange providers have started trading, the market’s interest in the digital currency is actively soaring.

Based on this aspect, recent reports indicate that the CBOE was forced to halt trading of bitcoin futures due to the incredibly large interest and increasing prices, hence letting the market cool down for a bit. Following the beginning of the first trading day, the price of bitcoin surged by roughly 26%. For instance, the January contract for bitcoin futures was closed at $18.545 over on the CBOE Futures exchange, whereas prices increased up to $18.850.

The CBOE also made a press statement, saying that in the first day of trading, at least a total of 20 trading firms participated in the trading of these futures. Regardless of this aspect, only around 4,000 contracts were traded on the first day, which is a fairly small number when compared to some of the other assets that are being traded on futures markets.

For those who do not know, futures can be regarded to as an agreement to either buy or sell a certain product, at a specific date. More exactly, it is a trading instrument used to speculate on what the price will be in the future. Apart from this aspect, futures can also be used in order to control risk in a portfolio, and this is especially attainable when the asset of the future is characterized by volatility.

It is expected that in the near future, if trading continues with similar intensity and once regulators learn more about the implications of trading bitcoin as a traditional asset, and using institutional money, it is more than likely that exchange traded funds may also appear on the market.

In the past, the Winklevoss twins did try to get a bitcoin ETF approved, yet the request was denied by the competent regulator over fears associated with volatility, volumes etc. However, now that futures have been approved by regulators throughout the United States, if everything goes ahead as planned, chances are that a bitcoin ETF could be underway as well.

Based on everything that has been outlined so far, the first trading day was more than positive towards bitcoin futures, and showcases a promising future.