According to a report from Reuters, Leo Melamed, former Chairman of CME group, believes in the future of Bitcoin. Melamed recently said that there is a strong likelihood that Bitcoin will soon be considered a legitimate asset class that can be traded and regulated the same way that stocks and commodities can be; his sentiments were reflected when CME and CBOE both told Reuters of plans to add Bitcoin trading options to their platforms.
When it Comes to Bitcoin Futures, The Future is Now
While it took a while for Bitcoin to get its “foot in the door”, Bitcoin is now quickly gaining a foothold in the world of traditional assets. Over the past year, cryptocurrency hedge funds (such as those managed by MetaStable and Polychain Capital) have become much more common. Additionally, several large exchanges and other kinds of trading platforms throughout the world have begun to take steps toward adding Bitcoin and other kinds of cryptocurrency.
CME, which is the largest derivatives exchange in the world, revealed plans to launch Bitcoin futures contracts just last week. CME’s Melamed told Reuters in a recent interview that the decision to add Bitcoin to CME’s roster was “a very important step for bitcoin’s history… We will regulate, make bitcoin not wild, nor wilder. We’ll tame it into a regular type instrument of trade with rules.”
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CBOE Announces Plans for Bitcoin Exchange-Traded Fund
Not to be outdone, CME’s rival CBOE announced that it would also be adding a Bitcoin-based exchange-traded fund to its platform, though the timeline for regulatory approval of such a fund is unknown.
Chris Concannon, COO and President of CBOE, seems to be encouraged by the competition with CME. He told Reuters: “Overall, the cryptocurrency space is the space that I think we believe in and certainly our competitor across town believes in as well, and I‘m just encouraged by that validation.”
The announcements from these two exchanges is certainly a sign of the times. Even a year ago, Bitcoin was largely regarded as “magic internet money”, a fringe movement led by anarcho-capitalists. Now, financial institutions are beginning to understand the potential that cryptocurrency holds, particularly for early adopters.
Some Wall Street giants, like JPMorgan Chase & Co.’s Jamie Dimon, are extremely skeptical, even hostile, towards the new technology. However, Melamed expressed a positive attitude–one that could result in big business for CME: “My whole life is built around new technology. I never said no to technology. People who say no to technology are soon dead. I’m still that same guy who believes in at least examining change. That’s what bitcoin represents.”