TradeStation Group president John Bartleman said: "We believe that CME's launch of the new Bitcoin futures contract represents a major milestone in the development of cryptocurrency derivatives markets that appear to be more fair and transparent than trading the underlying cryptocurrency". CBOE's future prices went as much as 13 percent above that of bitcoin in its first day of trading. Futures prices and bitcoin price The futures at CME traded about 2 percent about that of bitcoin's price this morning.
Many see the launch of bitcoin futures as a step towards establishing the digital currency as a legitimate asset class.
The Cboe futures contract is based on a closing auction price of bitcoin from the Gemini exchange, which is owned and operated by virtual currency entrepreneurs Cameron and Tyler Winklevoss. On its debut on Dec 10, the Cboe traded almost 4,000 contracts during the full session. Cardano is a decentralized public blockchain and cryptocurrency project and the company is developing a smart contract platform which "seeks to deliver more advanced features than any protocol previously developed", according to company's website. Gabor Gurbacs of VanEck Associates Corp. said: "One of the biggest issues when it comes to investing institutionally in digital assets is banks and larger institutions can't hold an unregulated instrument in their balance sheet, and a futures contract is something they can hold".
One CME futures contract is equal to five Bitcoin, whereas each Cboe futures contract is equal to one Bitcoin.
Are Bitcoin futures good or bad for the crypto market? The margin for an S&P 500 futures contract, by contrast, is 5 per cent, analysts said.
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"The order book is thin". Last week, Cboe's product was priced as much as 13 per cent higher than bitcoin, but that quickly narrowed.
Some brokerages didn't immediately give customers access to bitcoin futures. The company will not offer CME contracts until it demonstrates sufficient liquidity.
"We look at the volume, the open interest and the spreads, and we want to make sure that all those conditions are maturing properly", said JB Mackenzie, managing director for futures trading at TD Ameritrade.
The margin requirement at CME is 35 per cent, while at Cboe, it is 40 per cent, reflecting bitcoin's volatility.
Spot bitcoin eased 1.9 per cent on the Bitstamp exchange to $18,650, after surging to a record high of $19,666 on Sunday.