Chicago’s CBOE Exchange to Launch Bitcoin Futures on December 10
Just that the CME group recently announced the launch of its Bitcoin futures contract on December 18, competitor and rival - Chigaco-based CBOE Bitcoin futures exchange - plans to take an early lead and has announced the launch of its futures contract just five days after on December 10 and eight days before the CME Group’s schedule.
This makes CBOE now as the first U.S. Exchange to support the trading of Bitcoin-based futures products. The Bitcoin futures trading is expected to start at 5 pm CT with the ticker symbol identified by “XBT”.
Ed Tilly, chairman and CEO of CBOE Global Markets, in a statement, said: “Given the unprecedented interest in bitcoin, it’s vital we provide clients the trading tools to help them express their views and hedge their exposure. We are committed to encouraging fairness and liquidity in the bitcoin market. To promote this, we will initially offer XBT futures trading for free.”
The CBOE group has earlier clarified that its futures contracts will be cash-settled. These will keep the gates open even for those investor who do not actually want to buy Bitcoin but can still trade in them with cash settlement.
Also, CBOE will be using the Bitcoin price based on the daily auction price as provided by the New York-based cryptocurrency exchange - Gemini. As an additional incentive to investors, CBOE will wave the trading fees for this month of December.
Tyler Winklevoss, CEO of Gemini, said: “Developing a regulated derivatives market is the next logical and crucial step towards advancing the broader digital asset market. We have been working for years to build infrastructure to grow the digital asset market and today’s news marks a significant milestone.”
In addition to the Bitcoin futures contract, CBOE president Chris Concannon has hinted that gain ahead, the exchange can also provide similar futures contract for Ether and Bitcoin Cash. The Bitcoin futures contracts have caught the attention of many big financial institutions in the market. Nikolaos Panigirtzoglou, a global markets strategist at JPMorgan, said that Bitcoin futures would legitimize cryptocurrency for both retail and institutional investors. He further said "The prospective introduction of bitcoin futures has the potential to elevate cryptocurrencies to an emerging asset class.”
Many analysts believe that once the concept of Bitcoin futures contract becomes a success story is can create and pave the path for Bitcoin exchange-traded-funds in U.S. Moreover, the introduction of such investment products is also likely to bring stability in prices making it less volatile in nature. This will certainly help Bitcoin to emerge as a mainstream digital currency of the future.