Bitcoin futures debut in US, surge 22%
NEW YORK/SYDNEY/LONDON: Bitcoin futures eased back from an initial surge of almost 22% to trade up 13% on Monday, in an eagerly awaited US market debut that backers hope will confer greater legitimacy on the volatile cryptocurrency and lead to its wider use.
Although bitcoin futures were already offered on some unregulated cryptocurrency exchanges outside the US, the Chicago-based Cboe Global Markets’ launch marked the first time investors could get exposure to the market via a mainstream regulated exchange.
The debut on Sunday night may have caused an early outage of the Cboe website. The exchange said that due to heavy traffic, the site “may be temporarily unavailable”.
The one-month bitcoin contract opened trade at 6 pm local time (2300 GMT) at $15,460, dipped briefly before rising to a high of $18,700 and then slipping again. As of 1112 GMT the one-month future was up 13% from the open at $17,450, around $1,000 higher than the “spot” bitcoin price the price at which bitcoin is currently being bought and sold.
The two-month contract was trading at $18,880, while the three-month contract was changing hands at $19,040.
“The premiums have so far been very high, demonstrating that few want to take the short side of the trade,” said Altana Digital Currency Fund manager Alistair Milne, whose fund has $35 million in assets under management.
In just over 12 hours after the launch, 2,780 contracts had been traded, meaning around $48.5 million had been notionally invested. That compares with daily trading volumes of more than $20 billion across all cryptocurrencies, according to trade website Coinmarketcap.
Just 13 trades of the twomonth contracts had been traded. “It will take time for derivative volumes to build up, but eventually if they prove to be a significant percentage of the global trade, they should in theory help stabilise things,” said Milne.