On Sunday night Chicago-based derivatives exchange Cboe Global Markets became the first place available to trade Bitcoin futures on a regulated exchange. The early indicators are extremely positive for Bitcoin’s price.
What is a Future?
Bitcoin Futures, in a nutshell, is a contract that let investors buy or sell something at a specific price in the future. They are created on computers using complex algorithms and recorded in a digital ledger. You are basically buying or selling what you think Bitcoin’s price will be in one to three months.
Whats this Mean for Bitcoin’s Future?
The outlook is overwhelmingly positive for bitcoin futures! Cboe Global Markets is the first regulated exchange in the United States will continue to build legitimacy for Bitcoin to continue its rise in the mainstream market. This will assist the average US citizen who had doubts about the cryptocurrency to become more comfortable potentially investing in and getting involved with the purchasing of Bitcoin or other altcoins. The futures immediately caught up to the current price of the coin and seem to be settling around 10% above the actual price of Bitcoin. Snapshot of the current Bitcoin future contracts as of 245pm EST 11 Dec 2017
If this remains the trend we could start to see a slower rise in Bitcoin as opposed to the daily rise and dip of 20% we are currently seeing. This is a good thing in the long run for slow steady growth. Currently, only 1, 2, or 3-month contracts are available for trading and the 3-month contracts are roughly a 9% premium from Bitcoin’s current price. Time will tell how the market will react after bitcoin futures have been available for more than a few days but the initial outlook continues to look extremely positive as more time passes.
We will continue to update this article throughout the week to deliver the latest developments in Bitcoin Futures.