Market Overview

Bitcoin Futures Are Coming To CME Group

Bitcoin Futures Are Coming To CME Group

Just days after Gain Capital Holdings Inc (NYSE: GCAP) announced it will be launching bitcoin trading on its platform, CME Group Inc (NASDAQ: CME) now says it will be launching bitcon futures starting in the fourth quarter.

According to a press release, the new contracts will be cash-settled and based on the CME CF Bitcoin Reference Rate (BRR).

“As the world's largest regulated FX marketplace, CME Group is the natural home for this new vehicle that will provide investors with transparency, price discovery and risk transfer capabilities," CME Group CEP Terry Duffy said.

Bitcoin Boom

Bitcoin is the largest and most popular cryptocurrency in the world, making up more than half (54 percent) of the $172 billion total global cryptocurrency market cap.

The SEC has been slow to approve bitcoin ETFs to trade on major U.S. markets due to its volatility and lack of regulation, leaving potential bitcoin traders with limited options.

As it stands, one of the most popular ways for traders to play bitcoin is the OTC-listed Bitcoin Investment Trust (OTC: GBTC). However, long-term investors may be paying a hefty premium for the GBTC ETF. In September, Citron Research said the Bitcoin Investment Trust was grossly overvalued.

"Do you want to own a fund that owns [Bitcoin] while paying a price 70% higher than what the underlying asset is actually worth?” Citron asked in the report.

Despite Citron and a long list of other skeptics, bitcoin’s value explosion hasn’t slowed down in 2017. The GBTC ETF is now up 541 percent year-to-date. Bitcoin itself rose to a record-high $6,330by Tuesday morning.

Related Links:

The Next Way To Play The Bitcoin Boom: Gain Capital

What Is An Initial Coin Offering, Or ICO, And Which Should You Invest In?


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