Due to an increase of the CME Group’s client interest in the cryptocurrency market, the exchange has decided to add bitcoin to its trading platform. “CME Group is always looking to bring new products to the marketplace,” told Terry Duffy, CME Group Chairman and CEO in an interview with Bloomberg on October the 31st.
This year, the virtual currency market has increased exponentially. This situation created an increasing interest, not only in individuals, but also in big and institutional investors. While small investors can trade in worldwide-known platform exchanges, institutions prefer safer and better regulated markets.
Terry Duffy commented on a statement released by the company:
“We are pleased to bring Bitcoin futures to market after working closely with the CFTC (U.S. Commodity Futures Trading Commission), and market participants to design a regulated offering that will provide investors with transparency, price discovery, and risk transfer capabilities.”
CME Group Opens Doors for Big Investors
The CME Globex electronic trading platform will feature the bitcoin futures products. At the same time, Bitcoin price will be based in accordance with the different rates provided by diverse cryptocurrency exchanges.
“At launch, our new Bitcoin futures contract will be subject to a variety of risk management tools, including an initial margin of 35 percent, position and intraday price limits, and number of other risk and credit controls that CME Group offers on all of its products,” – Terry Duffy.
Different bitcoin exchanges have given their opinions about the CME Group launching bitcoin futures. GDAX, Genesis Global Trading, itBit, Kraken and Bitstamp are just some examples of platforms conferring positive comments to it.
Markets, Hedge Funds and Exchanges are Looking Forward to Introduce Bitcoin
Weeks before the CME Group, its competitor, the Chicago Board Options Exchange (CBOE), was planning to launch its own bitcoin derivatives trading the first months of 2018. “We’ve really come to the conclusion recently that cryptocurrencies are here to stay,” said to CNBC, John Deters, chief strategy officer of CBOE.
According to the Wall Street Journal (WSJ), Nasdaq, the second largest exchange in the world, will launch Bitcoin futures during the next year. These are positive news for the cryptocurrency community that is growing day after day. This is in line with what other hedge funds and important exchanges are doing.
About the technology behind Bitcoin, Nasdaq’s CEO, Adena Friedman has given her opinion:
“The cloud is going to change a lot of how we manage our infrastructure, how we interact with each other and how we are able to scale and grow. If you look at the efficiency, the blockchain has a huge ability to change the way settlement occurs and the transfer of ownership.”
Bill Miller and Mike Novogratz are other important cryptocurrency players that have decided to invest in Bitcoin. Mr. Miller commented, during an interview, that 30 percent of Miller Value Partners hedge fund are invested in Bitcoin.
Regarding Mike Novogratz, he has started his own hedge fund and he hopes to rise $500 million dollars. “The institutionalization of this space is coming. It’s coming pretty quick,” he said at the Reuters Global 2018 Investment Outlook Summit in New York.
Date Published: Friday December 15, 2017
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