Bitcoin futures suggest breakneck rise ter price to slow, Reuters
Fresh YORK/LONDON (Reuters) – Freshly launched bitcoin futures on Monday suggested that traders expect the cryptocurrency&rsquo,s impetuous price gains to slow ter the coming months, even spil it blasted above $17,000 to a fresh record high ter the spot market.
Chicago-based derivatives exchange Cboe Global Markets launched the futures late on Sunday, marking the very first time investors could get exposure to the bitcoin market via a large, regulated exchange.
The one-month bitcoin contract <,0#XBT:>, opened at 6 p.m. local time (2300 GMT) on Sunday at $15,460. By late afternoon on Monday ter Fresh York, it wasgoed trading at $Legal,650, harshly 8 procent above bitcoin&rsquo,s spot price of $16,900 on the Bitstamp exchange.
Bitcoin earlier klapper a record high of $17,270.
Its steep gains and rapid rise have attracted investors around the world spil well spil intense scrutiny from government regulators, which is the very opposite of what its creators desired when it very first launched bitcoin more than eight years ago.
&ldquo,The bitcoin founder should be horrified watching it rise so quickly, spil any serious concentrate on it and its latest explosive stir higher will soon end its freedom,&rdquo, said John Taylor Jr, voorzitter and founder of research hard Taylor Global Vision ter Fresh York.
Taylor believes that based on his charts, bitcoin has not yet peaked, but spil soon spil the &ldquo,upmove completes, it will crash.&rdquo,
Given bitcoin has almost tripled te value overheen the past month, and wasgoed up more than 15 procent on Monday alone, the futures pricing suggested investors see price increases moderating.
Bitcoin futures were already suggested on some unregulated cryptocurrency exchanges outside the United States, but backers said the U.S. market debut would confer greater legitimacy on the volatile cryptocurrency and encourage its broader use.
The CME Group is expected to launch its futures contract on Dec. 17.
Graphic – Bitcoin futures suggest growth, but slower: reut.rs/2yfblkV
Albeit there are hopes that the futures will draw ter fresh investors, most fund managers at larger asset managers and institutional investors said bitcoin remains too volatile and lacks the fundamentals that give other assets value.
&ldquo,There&rsquo,s no place for bitcoin ter a multi-asset portfolio given the very high volatility,&rdquo, said Robeco Chief Investment Officer Lukas Daalder.
The two-month contract wasgoed trading at $Legal,750, an 11 procent premium overheen the spot price, while the three-month contract wasgoed switching mitts at $Legal,140, a toughly 12 procent premium.
While modest when compared with bitcoin&rsquo,s 270 procent increase overheen the past three months and 230 procent rise te the last two months, those levels still indicated a lack of large &ldquo,brief&rdquo, positions betting against bitcoin.
&ldquo,Anyone, especially a professional trading uitrusting, would be crazy to actually brief sell this bull market,&rdquo, said Nick Spanos, founder of Bitcoin Center NYC. &ldquo,But just because it doesn&rsquo,t toebijten on day one doesn&rsquo,t mean it won&rsquo,t te the future.&rdquo,
Bitcoin wasgoed up more than 1,600 procent so far ter 2017, having began the year at less than $1,000.
&lsquo,MARCH TOWARDS LEGITIMISATION&rsquo,
Spil of early afternoon trading ter Fresh York, Three,951 one-month contracts had switched palms, meaning around $73.1 million had bot notionally traded. That compares with daily trading volumes of more than $21.Five billion across all cryptocurrencies, according to trade webstek Coinmarketcap.
There had bot speculation that the futures launch would trigger more gyrations te the market. But while volatile compared with traditional currencies or assets, the rise on Monday wasgoed relatively tame for bitcoin.
Bitcoin surged more than 40 procent ter 48 hours last week, before tumbling 20 procent te the following Ten hours.
&ldquo,(Bitcoin futures) will speed up the march towards legitimisation of an asset class that only a few years ago many law enforcement agencies would have argued had limited legitimate reasons for people to use,&rdquo, said Jo Torode, a financial crime lawyer at Ropes & Gray te London.
The futures are cash-settled contracts, permitting investors exposure without having to hold any of the cryptocurrency.
The futures are based on the auction price of bitcoin ter U.S. dollars on the Gemini Exchange, which is possessed and operated by virtual currency entrepreneurs and brothers Cameron and Tyler Winklevoss.
Bitcoin wasgoed set up te 2008 by an individual or group calling themselves Satoshi Nakamoto, and wasgoed the very first digital currency to successfully use cryptography to keep transactions secure and hidden, making traditional financial regulation difficult if not unlikely.
Central bankers and critics of the cryptocurrency have bot ringing the hulpgeroep bells overheen its surge te price and other risks such spil whether the opaque market can be used for money laundering.
&ldquo,It looks remarkably like a bubble forming to mij,&rdquo, the Reserve Handelsbank of Fresh Zealand&rsquo,s Acting Governor Grant Spencer said on Sunday.
Somebody who invested $1,000 te bitcoin at the commence of 2013 would now be sitting on around $1.Two million.
Heightened excitement ahead of the launch of the Cboe futures talent an reserve kick to the cryptocurrency&rsquo,s scorching run this year.
The launch has so far received a mixed reception from big U.S. banks and brokerages.
Several online brokerages, including Charles Schwab Corp and TD Ameritrade Holding Corp, did not permit trading of the fresh futures instantaneously.
The Financial Times reported on Friday that JPMorgan Pursue & Co and Citigroup Inc would not instantly clear bitcoin trades for clients.
Goldman Sachs Group Inc said on Thursday it wasgoed programma to clear such trades for certain clients.
Graphic – Bitcoin’s sweeping ascent: tmsnrt.rs/2AeMjHe
Extra reporting by Chuck Mikolajczak and John McCrank ter Fresh YORK, Michelle Chen te HONG KONG and Helen Reid ter LONDON, Graphics by Ritvik Carvalho ter LONDON and Reuters Graphics team, Editing by Meredith Mazzilli