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Here a look into where the Bitcoin Futures have reached so far and how far they have performed vis-a-vis the expectations created.
The talk about Bitcoin Futures once again catches steam as ICE announced the launch of Bakkt Bitcoin Futures this December. ICE’s Bakkt platform will offer Bitcoin Futures settlement in physical Bitcoin tokens. Many experts have praised ICE’s entry into the crypto space saying that it will create further room for institutional entry.
Now that ten months have passed since the launch of first Bitcoin Futures in December 2017, let’s have a look where we have reached so far. Exactly one year back, the CME Group first talked about releasing its Bitcoin futures contracts in the crypto market. Soon after that, the Bitcoin price caught wildfire roaring higher and higher without looking back. By the time of launch, Bitcoin hit its all-time high of $20000 turning the attention of the global financial community towards itself. Note, both CBOE and CME launched their Bitcoin Futures contracts almost during the same time in December 2018.
Many industry experts then thought that Bitcoin futures will usher huge liquidity in the crypto market. Undoubtedly, the primary reason for launching Bitcoin Futures was to attract higher institutional participation. Ten months have passed since then, but have things rolled down as expected? Bloomberg present some key insights into the journey so far!
Bitcoin Futures Not Keeping Up the Hype
Michael Unetich, vice president of cryptocurrencies at Chicago-based Trading Technologies International Inc. says things kicked-off pretty well at the beginning. Experts were expecting tens of thousands of daily order. However, “the market just wasn’t ready for that to happen,” says Unetich.
After CME recently released its Q3 report, Craig Pirrong, a finance professor at the University of Houston says “It has not been what you would call a roaring success”. Although the CME’s Q3 report shows Bitcoin Futures volumes picking up, there is no exemplary growth. Pirrong who is also an expert of futures trading said: “Institutional players have stayed on the Bitcoin sidelines, and as long as they are, the futures contracts are likely not to generate substantial amounts of volume.”