Chairman and CEO of CME Group Ted Duffy has today made the most specific mention of when the CFTC-regulated and broker-ready Bitcoin Futures will be available: Second week of December.
Currently, the space is dominated by BitMEX, OKex, Deribit, and Crypto Facilities, unregulated futures with social loss algorithms to control risk. Since they are not regulated futures that are centrally cleared and guaranteed under strict rules, they represent more parimutuel betting products. While they are professionally run by fantastic teams, they still serve an unregulated market that uses only bitcoin as collateral and has inverse payouts in fiat pairs (US dollar).
The CME product will be cash-settled, just like the unregulated products. They will not trade over the weekend, whereas the unregulated products trade 24/7 with very low fees. The CBOE has also announced its intention to list Bitcoin Futures. Van Eck is also making efforts.
These groups of exchanges will co-exist with one another. Just because CME trades a product that traders on Interactive Brokers and ETRADE can access, doesn't mean that there is not a role for the OG crypto derivatives exchanges to play.
One strong point of the unregulated exchanges is that they use crypto for collateral. The CME product uses only fiat that brokers offer. There is a totally different market segment being targeted. Only a small share of the existing traders on crypto-collateral derivatives exchanges would be dragged away to the legacy exchanges. The ability to pull out your profits intra-day in cryptocurrency has serious value that CME simply does not offer.
So have no fear, the existing exchanges will coexist just fine with the growing group of regulated products, and the crypto ecosystem as a whole will grow. A growing pie feeds everyone just fine! Here is Duffy on CNBC below in VIDEO:
Currently, the space is dominated by BitMEX, OKex, Deribit, and Crypto Facilities, unregulated futures with social loss algorithms to control risk. Since they are not regulated futures that are centrally cleared and guaranteed under strict rules, they represent more parimutuel betting products. While they are professionally run by fantastic teams, they still serve an unregulated market that uses only bitcoin as collateral and has inverse payouts in fiat pairs (US dollar).
The CME product will be cash-settled, just like the unregulated products. They will not trade over the weekend, whereas the unregulated products trade 24/7 with very low fees. The CBOE has also announced its intention to list Bitcoin Futures. Van Eck is also making efforts.
These groups of exchanges will co-exist with one another. Just because CME trades a product that traders on Interactive Brokers and ETRADE can access, doesn't mean that there is not a role for the OG crypto derivatives exchanges to play.
One strong point of the unregulated exchanges is that they use crypto for collateral. The CME product uses only fiat that brokers offer. There is a totally different market segment being targeted. Only a small share of the existing traders on crypto-collateral derivatives exchanges would be dragged away to the legacy exchanges. The ability to pull out your profits intra-day in cryptocurrency has serious value that CME simply does not offer.
So have no fear, the existing exchanges will coexist just fine with the growing group of regulated products, and the crypto ecosystem as a whole will grow. A growing pie feeds everyone just fine! Here is Duffy on CNBC below in VIDEO:
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