Bitcoin Futures in 2018
3 min read

What to Expect from Bitcoin Futures in 2018

By Editorial Team

The CBOE announced last month that it would finally be launching futures trading for cryptocurrencies.

The initiative makes the CBOE the first options exchange to provide investors with a new way to invest on, or wager against, the popular new market.

According to Ed Tilly, the Chairman and CEO of the CBOE Global Markets

Given the unprecedented interest in Bitcoin, it‘s vital we provide clients the trading tools to help them express their views and hedge their exposure

Last Year’s “Futures Rally”

Cryptocurrency prices skyrocketed and broke record levels last year due to various economic reasons, one of which was the promise of the CBOE to offer investors the option to trade cryptocurrencies.

Bitcoin’s Price Index last year shows how the cryptocurrency’s prices jumped from below $1,000 at January 2017 to almost $20,000 at the final quarter of last year.

Bitcoin futures in 2018 will give investors exposure to the trends of cryptocurrencies. Analysts believe that it will also set the stage for a Bitcoin ETF in the U.S., and, potentially, the rest of the world.

New Bitoin Instruments in 2018

The Cantor Exchange, a U.S.-based binary options exchange, also self-certified a new contract for Bitcoin’s binary options along with CBOE’s announcement to offer investors futures trading.

Futures trading is an agreement between two parties — the buyer and the seller — to exchange an asset at a future date. Futures were originally created in order for farmers to hedge against the changes in prices of their crops between planting and harvest time.

With cryptocurrency futures, the concept for the market will remain the same — hedging cryptocurrencies against the volatility of future prices.

Another way to trade on the cryptocurrency market will be through binary options. This is a platform where traders make money by making correct predictions of the price movements of indices, commodities, currencies, and many other assets. Nadex’s binary options page states that the trade provides a limited-risk contract based on a simple yes or no question.

Binary options also extend to predicting the rise and fall of cryptocurrencies. If an investor correctly predicts that the price of Bitcoin will rise at 3 PM tomorrow, that person will earn a profit. If the investor is wrong, the trading capital will be lost.

Details of Contracts

CBOE’s Bitcoin futures will be using the ticker symbol of XBT. Trades will be settled by cash against the auction price of Gemini Trust — the digital currency exchange that was built by the Winklevoss twins.

The Bitcoin futures that will be offered by CME will come at a later time. However, it was confirmed that the trades will be settled against 4 exchanges namely GDAX, itBit, Bitstamp, and Kraken. CME’s announcement of Bitcoin futures followed that of CBOE’s, which launched Bitcoin futures contracts on December 10, 2017.

Next Step to Mass Adoption

Analysts say that the launching of Bitcoin futures in 2018 is an important step towards the acceptance and legitimization of cryptocurrencies. Although Bitcoin futures have been available at the Bitmex Exchange for some time, these futures contracts will allow institutional investors to enter the market.

Today, Bitcoin is being accepted by thousands of merchants around the world, and some countries are now writing laws in order to better regulate the cryptocurrency.

If 2017 was the rise of cryptocurrency, 2018 could see the currency stabilize and become globally recognized as a sustainable currency.

Featured Image via Fotolia

Editors at large. Posting the latest news, reviews and analysis to hit the blockchain.
View all posts by Editorial Team -> Best Crypto Deals ->

Latest Posts

Trader Joe Review
Trader Joe Review 2022: Complete Guide to the Top DEX on Avalanche
Trader Joe Review

Trader Joe Review 2022: Complete Guide to the Top DEX on Avalanche

July 2, 2022 30 min read
Huobi Global Review
Huobi Global Review 2022: Good Exchange with DEEP Liquidity
Huobi Global Review

Huobi Global Review 2022: Good Exchange with DEEP Liquidity

June 29, 2022 37 min read
FTX vs FTX US Review
FTX vs FTX US: Which one is BEST for You?
FTX vs FTX US Review

FTX vs FTX US: Which one is BEST for You?

June 27, 2022 14 min read
Bancor Review
Bancor Review: Impermanent Loss Protector?
Bancor Review

Bancor Review: Impermanent Loss Protector?

June 22, 2022 15 min read
Bridge Mutual Review
Bridge Mutual: Insurance for your Crypto
Bridge Mutual Review

Bridge Mutual: Insurance for your Crypto

June 22nd, 2022 22 min read
Serum Review
Serum Review: Solana’s One-Stop DeFi Toolbelt
Serum Review

Serum Review: Solana’s One-Stop DeFi Toolbelt

June 16, 2022 17 min read
Raydium Review: Solana’s DeFi Liquidity Mammoth

Raydium Review: Solana’s DeFi Liquidity Mammoth

June 11, 2022 17 min read

Related Posts

Trader Joe Review
Trader Joe Review 2022: Complete Guide to the Top DEX on Avalanche
Trader Joe Review

Trader Joe Review 2022: Complete Guide to the Top DEX on Avalanche

July 2, 2022 30 min read
Huobi Global Review
Huobi Global Review 2022: Good Exchange with DEEP Liquidity
Huobi Global Review

Huobi Global Review 2022: Good Exchange with DEEP Liquidity

June 29, 2022 37 min read
FTX vs FTX US Review
FTX vs FTX US: Which one is BEST for You?
FTX vs FTX US Review

FTX vs FTX US: Which one is BEST for You?

June 27, 2022 14 min read
Bancor Review
Bancor Review: Impermanent Loss Protector?
Bancor Review

Bancor Review: Impermanent Loss Protector?

June 22, 2022 15 min read
Bridge Mutual Review
Bridge Mutual: Insurance for your Crypto
Bridge Mutual Review

Bridge Mutual: Insurance for your Crypto

June 22nd, 2022 22 min read
Serum Review
Serum Review: Solana’s One-Stop DeFi Toolbelt
Serum Review

Serum Review: Solana’s One-Stop DeFi Toolbelt

June 16, 2022 17 min read
crypto com
Crypto.com Exchange Review 2022: A World-Class Crypto Exchange
crypto com

Crypto.com Exchange Review 2022: A World-Class Crypto Exchange

June 14th, 2022 30 min read