By
Bhushan Akolkar
April 19th, 2024
Given token’s price unprecedented growth and even wider adoption, it seems that there is absolutely no stopping Bitcoin for now!
The most popular cryptocurrency is breaking its previous records day-in-day-out and surging to new highs. Just yesterday Bitcoin surpassed its previous high of over $6400 following the announcement of CME Group, the world’s largest futures market operator, which is planning to launch Bitcoin futures contracts by the year-end being currently in talks with the U.S. Commodity Futures Trading Commission for approval.
Today, driving further on the same wave, Bitcoin has skyrocketed to its new high of above $6600, precisely $6634.89 as per Coinmarketcap.com. Reaching this new milestone now means that Bitcoin has surged by over 550% in value this year which is really pathbreaking and unprecedented in its own ways. With this, the overall cryptocurrency market valuation has reached its record high of $183 billion with Bitcoin contributing a $110 billion in market cap valuations.
Bloomberg has officially confirmed writing the “floodgates have been opened”, and “Bitcoin is going legit, for better or worse.” Last month, the CME Group rejected any plans to begin Bitcoin future contracts, but now the corporation says that the demand and client hunger forced them to reconsider the decision.
According to the press release, CME Group chairman and CEO, Terry Duffy has stated:
Given increasing client interest in the evolving cryptocurrency markets, we have decided to introduce a Bitcoin futures contract. 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.
Flooding the cryptocurrency markets with a lot of liquidity, opening of the Bitcoin Futures will also contribute to increasing participation of institutional investors and traders. Based on the CME CF Bitcoin Reference Rate* (BRR), the Bitcoin Futures Contract will be completely settled in cash. This will allow traders to hedge cash positions with the digital money, which has been quite difficult to do till now.
*The Bitcoin Reference Rate (BRR) is once-a-day reference rate of Bitcoin in U.S. Dollar as of 4:00 p.m. London time. The BRR was created by the CME Group in tandem with UK-based Bitcoin futures exchange Crypto Facilities Ltd last November.
Expert Views
Just like Jamie Dimon – CEO of J.P. Morgan – who went out openly criticizing Bitcoins back in September, there are many other prominent individuals who have been singing the same pessimistic tune concerning the cryptocurrency. However, with such an unprecedented move in the Bitcoin price, one thing has been made clear – no one can ignore it!
Citi Group CFO, John Gerspach said that his immediate team is having an “intense” look at the functioning of cryptocurrency and blockchain technology in general. Similarly, Lloyd Blankfein, Goldman Sachs Group Inc. CEO has noted that his company is looking to work out ways to engage with this technology.
Kyle Samani, managing partner of cryptocurrency hedge fund Multicoin Capital, said while commenting on the topic:
This is big news. As a proxy, gold derivatives markets are much larger than gold markets. The same could happen here. Overall, this is a big deal for crypto.
In addition to the CME Group, largest U.S. options exchange – Chicago Board Options Exchange (CBOE) is also waiting for an approval nod from the U.S. Commodity Futures Trading Commission and is said to start cash-settled Bitcoin futures contract by 2018.