The race between the Chicago Mercantile Exchange (CME) and the Chicago Board of Options Exchange (CBOE) during the years has been extremely competitive. When it comes to Bitcoin futures, however, it seems that the latter will have the upper hand, at least regarding getting to market first.
The CBOE has just announced that it is preparing to go live next Sunday, 10th of December at 23:00 GMT (17:00 CT). The firm is providing an initial incentive to Bitcoin market aficionados with free trading until the end of December.
Last week the CME confirmed that it would start offering Bitcoin futures on the 17th of December, a week after the CBOE.
Exchanges have been instructed by the CFTC, the US regulator, to gather additional data from their crypto-centered peers that are delivering the price quotes. The measure is aiming to prevent Bitcoin price manipulation.
Risk Management for Businesses in Today’s WorldGo to article >>
Earlier today, the Moscow Exchange also announced plans to deploy a Bitcoin futures contract to the market.
Futures Trading Could Disrupt the Market
The relationship between cash-settled futures trading and Bitcoin prices prompt a lot of unanswered questions. Prices of Bitcoin should technically be influenced only by physical (digital) purchases of the digital currency.
In contrast to futures markets for oil or gold, where a client can take delivery upon the expiration of the contract, traders of Bitcoin futures will be obliged to settle at the market price. In theory, entities that are purchasing significant amounts on the futures markets could be affecting real prices via buying BTC on crypto exchanges in smaller quantities.
The high initial margin requirements that the CME Group announced last week are indicating that the product will be cautiously introduced to the market. Some executives in the trading industry argue that the introduction of a futures contract should decrease volatility.
One way or the other, brokers will soon have access to a relatively reliable source of data on Bitcoin prices. Both the CME and the CBOE will use a set of crypto exchange partners to deliver a real-time and reliable price gauge to their clients.