Nasdaq, one of the most influential stock exchanges in the whole planet, has stated its intentions of launching Bitcoin futures, saying that it could start doing it as soon as the first quarter of next year. The information was provided by Bloomberg, this Tuesday.
Bloomberg quoted two people familiar with the situation as its sources. They say that momentum “was building towards” a possible launch in the first part of 2019, a moment in which the price of Bitcoin will be totally uncertain.
At the moment of writing this article, the price for each BTC was $3,847.68, which would be a 2.94 percent improvement over what it showed in the last 24 hours. However, 2018 has been rough for BTC and all altcoins.
The most prominent and widely used cryptocurrency reached $19,000 at one point in January, but it dropped all year to the $6,400-$6,500 range, in which it somewhat stabilized until November 14th. Starting from that day, it has collapsed yet again to reach the levels it shows today, and as experts still debate whether this is rock bottom or there is more room to go down, a setting for futures appears. BTC’s, recent performance marks the “tail end of a testing year for existing Bitcoin future products,” according to Cointelegraph.
“Nasdaq has been working to satisfy the concerns of the U.S.’s main swaps regulator, the Commodity Futures Trading Commission [CFTC], before launching the contracts,” the two unnamed sources told Bloomberg.
A Plan in the Making
Nasdaq has been toying with the idea of Bitcoin futures for over a year. They first stated that they would do it by the middle of this year, after CBOE and CME Group scheduled the launch in the month of November 2017.
However, regulatory issues had forced executives to delay the date. Now, some critical competitors jumped ahead of Nasdaq and have offered futures before the US-based stock exchange. Among them are the Intercontinental Exchange’s Bakkt, which is scheduled to launch physical Bitcoin futures on January 24th.
Nasdaq is clearly not afraid of Bitcoin’s current vulnerability and volatility, as is evident in the stock’s enthusiasm. In fact, the exchange is, according to Bloomberg’s sources, “betting on sustained interest” in the future.
What exactly are Bitcoin Futures?
A “future” is an agreement to acquire or sell a specific good or asset on a previously specified future date at a previously agreed upon price, no matter what the market shows at the moment of making the transaction. It is known as a risk management tool rather than a profit maximization approach.
When we talk about Bitcoin futures, the agreement will allow speculators to place a bet on what they think the price is going to be in the future. People can; therefore, speculate on the value of the asset without actually having to own BTC.
Bitcoin futures can be traded on regulated exchanges, a positive setting for those worried about the lack of regulation of the industry. Also, these kinds of deals let investors speculate on BTCs price on locations in which trading Bitcoin is prohibited.
By Andres Chavez