Bitcoin, the cryptocurrency which trades 24 hours a day and seven days a week, hit a new high, reaching just below $11,800 on the Bitstamp exchange on Sunday. By Monday, it was back to slightly under $11,000.

The Launch of Bitcoin Futures will Mean Regulation for the Cryptocurrency

Views: 83

Bitcoin, the cryptocurrency which trades 24 hours a day and seven days a week, hit a new high, reaching just below $11,800 on the Bitstamp exchange on Sunday. By Monday, it was back to slightly under $11,000. The weekend movement shows the currency’s unrelenting popularity and an incoming of new investors. The increases were also likely spurred by Friday’s announcement by the main U.S. derivatives regulator, the CFTC, to allow CME Group Inc. and CBOE Global Markets to list bitcoin futures contracts, as the exchanges declared two weeks ago.

The CME futures will be available for trading beginning on December 18. Last week, Nasdaq also announced it will launch bitcoin futures in the first half of 2018, as early as the second quarter on its NFX market. That makes the New York Stock Exchange the only of the four major U.S. exchanges not to have announced plans to offer bitcoin derivatives. “The price rises are triggered by continued media interest driven by the expectation of futures trading on CME,” said Charles Hayter, founder of data analysis website Cryptocompare.

Bitcoin currently trades on markets which are practically unregulated, while the Nasdaq, CME and Cboe are deeply regulated. This expanded trading venue would bring an air of legitimacy to Bitcoin, which has thus far behaved like a bubble growing without control. As reported by Bloomberg, Bitcoin’s price has doubled in value by more than 11 times this year. It traded for $1000 in the beginning of 2017.

As reported by Reuters, bitcoin prices fell by Monday because of worries of increased government attention and possible regulation. Think Markets analyst Naeem Aslam said Britain wants to increase regulation of bitcoin and other digital currencies. He said they believe that the European Union’s anti-money-laundering laws, which oblige traders to disclose their identities and report suspicious activity, should be enforced for the cryptocurrency. Yet others said an increase in regulation would help the price. “If anything, regulation will only increase bitcoin’s rate of growth as regulation lends credibility and engenders trust,” said Nicholas Gregory, CEO of London-based cryptocurrency firm, CommerceBlock. JP Morgan’s analyst Nikolaos Panigirtzoglou went as far as to say, that the move to join the formal financial markets “has the potential to elevate cryptocurrencies to an emerging asset class,” adding reliability and long-term value perhaps similar to gold. Politicians in Washington will also necessarily be scrutinizing Bitcoin, as they work with US’s security exchanges to integrate it with the global exchanges.

By: Ilana Siyance

 

LEAVE A REPLY

Your email address will not be published. Required fields are marked with *

YOU MAY ALSO LIKE

INTERNATIONAL NEWS