CBOE Announces Bitcoin Futures Trading, Starting Dec. 10

CBOE Announces Bitcoin Futures Trading, Starting Dec. 10

On Friday a USA federal regulator gave the go ahead to the CME Group to start trading bitcoin futures later this month, the first time the digital currency will be traded on a Wall Street exchange and subject to federal oversight.

CME had announced last week that it would begin bitcoin futures trading on December 18.

Cboe Global Markets has announced that Cboe Futures Exchange plans to offer trading in bitcoin futures beginning at 5:00 p.m. CT on Sunday, December 10, 2017, at the start of Global Trading Hours.

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CME's bitcoin futures will be based on a "Bitcoin Reference Rate", which will be a "a once-a-day reference rate" based on the US-dollar price of the coins. The cryptocurrency is now trading at roughly $11,400, as per CoinDesk's Bitcoin Price Index (BPI).

The fact that this price was achieved much before the end of the year and that the prices overshot this region to move beyond the $11,000 region during the month was a sample of how strong this bull run has been during the month of November.

Bitcoin's price has soared tenfold this year, but many market participants warn of a bubble as it topped $11,000 for the first time last week. The Cantor Exchange took similar steps to begin trading new binary bitcoin options contracts. But there are a couple of differences between bitcoin futures trading at the two exchanges. Of course, this requires the approval of the regulators, which is likely to be a big challenge, but this also throws open the doors for the launch of bitcoin futures in other major exchanges which is likely to help the bitcoin market to continue to mature in a quick manner. To ensure minimal impact on markets due to bitcoin's price swings, traders will have to pay 33 percent of their trade's price upfront as compared to the 35 percent for CME bitcoin futures trades.

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