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Nasdaq Bitcoin Futures Confirmed

Nasdaq Bitcoin Futures Confirmed

Just last week, Bitcoin News reported Bloomberg’s findings on the world’s second largest stock exchange’s plan on moving forward with Bitcoin futures listing. This week, Nasdaq has cleared the air of all speculation by confirming this.

UK news outlet Express heard it from the horse’s mouth yesterday that Nasdaq would definitely be launching its Bitcoin futures within the first half of next year. This was obtained from two credible inside sources from within the organization.

Vice president of Nasdaq’s media team Joseph Christinat told an Express point man: “Bitcoin Futures will be listed and it should launch in the first half of next year – we’re just waiting for the go-ahead from the CFTC but there’s been enough work put into this to make that academic.”

Christinat added, “We’ve seen plenty of speculation and rumors about what we might be doing, but no one has thought to come to us and ask if we can confirm it, so, here you go – we’re doing this, and it’s happening.”

The current market trends might just be in need of a good news as this, in particular, is of more interest to institutional investors. However, this has a way of rippling into other mainstream financial affairs. The most likely of all institutions to feel the most impact would be traditional banking institutions, as the move will enlighten them on the serious roles cryptocurrency has in the future of finance. More so, it may be a step closer to legitimizing the market.

From Joseph’s statement, it would seem that they are no strangers to the development of both the blockchain technology and the cryptocurrency market, as he does emphasize on the efforts of the exchange toward engaging with the new venture.

“We got into the blockchain game five years ago, and when the technology first popped up we just leaned out of the window and shouted “hey come over here” right at it.”

However, the most assuring is that the exchange has spent so much on achieving this milestone:

“We’ve put a hell of a lot of money and energy into delivering the ability to do this and we’ve been all over it for a long time – way before the market went into turmoil, and that will not affect the timing of this in any way. No. Period. We’re doing this no matter what.”

Right now, all that’s left for the exchange is the final confirmation from the CFTC. This would also be the case with other players who are currently looking to launch their Bitcoin futures too. In the case of VanEck partnering with SolidX for a physically-backed Bitcoin exchange-traded fund (ETF), they are simply waiting on the US Securities and Exchange Commission (SEC) for approval.

 

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Federal Reserve: CME Bitcoin Futures Prompted Bear Market

Federal Reserve: CME Bitcoin Futures Prompted Bear Market

In a statement widely overlooked by the Bitcoin community, the Federal Reserve published a letter on its website in May 2018 blaming the launch of Bitcoin futures markets on the Chicago Mercantile Exchange (CME) for the decline of Bitcoin’s price.

Indeed, Bitcoin futures launched on CME on 17 December 2017, the same day the biggest Bitcoin rally in history reversed into a fall. On the very first day of Bitcoin futures trading, futures opened at USD 20,650 and closed at USD 19,055.

The Federal Reserve says this sort of market behavior has been observed in other asset classes when futures markets are introduced. Specifically, it mentions how the mortgage industry boom was reversed when futures markets for mortgage securities were launched.

Its reason for this is that when a new asset class is born, there are optimistic investors who buy it up, driving the market upwards. However, pessimistic investors have no voice and no way to bet against an asset’s value, until futures markets are launched. Once futures markets are launched, pessimistic investors can short sell, where they buy futures contracts via a loan, sell them for cash and then buy back the contracts later at a lower price before the contracts expire.

The Federal Reserve implicitly says that Bitcoin would have kept rising past USD 20,000 if CME had not launched Bitcoin futures and explicitly says the CME Bitcoin futures are the exact reason for the beginning of Bitcoin’s price collapse.

Further, the investment opportunity presented by Bitcoin futures diverts investment away from the spot markets. Bitcoin futures on CME are cash settled, meaning no Bitcoins are backing them. Therefore, investment into the futures does not increase spot demand for Bitcoin but in fact, causes Bitcoin’s price to be lower since the money invested into the futures is diverted from the spot market.

The Federal Reserve explains how the combination of short selling and diversion of investment away from the spot markets creates a feedback loop which forces Bitcoin’s price lower.

 

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Nasdaq Full Steam Ahead on Bitcoin Futures, New Target Q1 2019

Bloomberg has reported that Nasdaq Inc has decided to move forward with its plans to list Bitcoin futures and this could happen as soon as the first quarter of 2019.

Nasdaq is following up on its initial plans in November 2017 to launch Bitcoin futures in 2018, doing so in the hopes of sustaining a long-term cryptocurrency patronage. However, it failed to execute its original plans, committing to satisfy the standards imposed by the US financial regulator Commodity Futures Trading Commission (CFTC).

Bitcoin futures were thought to be instrumental to the astronomical rise of the price of Bitcoin last year, with the market registering price verticals as high as USD 20,000. The first two derivative markets to launch the bitcoin futures were CBOE Global Markets Inc and CME Group Inc, after which the CFTC decided to review the processes for listing crypto derivatives.

Nasdaq’s decision comes as a bold move considering the current market conditions, as Bitcoin has dropped from its all-time high and now trades as low as USD 4,000.

The current market conditions seem to have fallen short of the initial expectations that institutional investments attracted by the Bitcoin futures contract would be the sustaining wave for the next cryptocurrency mass adoption. However, this year’s market has only been in the reverse. Still, institutional investments remain a topic of focus as speculation on them make headlines daily.

Moving forward, it does seem as though Nasdaq had been brewing on its plans to ensure that it meets the demand of a wide range of investors and ensure that its contracts services are foolproof, thereby outpacing its competitors. This was disclosed by an unnamed source reported by Bloomberg who said:

“The Nasdaq futures will be based off the Bitcoin’s price on numerous spot exchanges, as compiled by VanEck Associates Corp… CME uses prices from four markets, while it’s just one at Cboe.”

On a general note, Nasdaq has shown a keen interest into blockchain technology as a whole alongside the derivative systems, even considering the possibility of a Nasdaq cryptocurrency exchange in the future.

 

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Sell or Hodl? Crypto Traders Seek Direction in Fluctuating Market

With uncertainty in the cryptocurrency market and a sudden drop in Bitcoin’s value overnight, investors are again posed with the sell or hold dilemma, but many experts maintain that increased demand for a Bitcoin exchange-traded fund (ETF) augers well for the flagship digital currency in the long term.

Long-term forecasters say that Bitcoin has a strong likelihood of becoming a reliable store of value and a viable payment mechanism. Experts point to rising futures volumes and increased institutional participation in trading as positive outcomes going forward.

Historically, negative news hits the market with a crash, such as the SEC’s rejection of nine cryptocurrency ETFs in August, despite the US regulator stressing it “emphasizes that its disapproval does not rest on an evaluation of whether Bitcoin, or blockchain technology more generally, has utility or value as an innovation or an investment”.

Signs are that despite this latest drop in market prices, the cryptocurrency ecosystem is healthy with daily trading almost doubling its total just days ago. Crypto advisory firm Autonomy’s co-founder Ricky Lee suggests, “For our trading activities, the [upcoming Bitcoin Cash] hard fork recently has generated tremendous interest and trading volume, above 4 billion daily, among traders.”

With Bitcoin’s value shedding almost USD 1,000 in just a few hours late yesterday, Willy Woo, the founder of data analytics site Woobull suggests that overnight recovery is highly unlikely and the current market trend may continue well into 2019. CNN Bitcoin analysts suggest that USD 5,633 is looking to be the current interim resistance level, but a break below that support would have the effect of scaring off investors. Conversely, a break above this level would suggest a long position at USD 5,712.

Looking for factors as to why the drop happened, whether it be Bitcoin futures or the Bitcoin Cash fork, there are suggestions that the effect of the sell-offs in tech stocks led by Apple on Wednesday are making their mark on cryptocurrency prices, although most point to the current uncertainty around so-called altcoins Bitcoin Cash and Ethereum, both poised for fundamental and controversial changes in development and infrastructure.

 

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Physical Bitcoin Futures on Bakkt, Launch Set for December 12, 2018

The Intercontinental Exchange (ICE), which operates 6 clearinghouses and 12 stock exchanges including the New York Stock Exchange (NYSE), has announced that physical Bitcoin futures will go live on 12 December 2018 on their first crypto exchange, Bakkt. Physical Bitcoin futures could lead to a major rally driven by institutional investments.

The Bitcoin for physical Bitcoin futures will be held in the ICE Digital Asset Warehouse, which is ICE’s new cryptocurrency custodian. After an investor buys physical Bitcoin futures they will be settled the same day at 5 pm Eastern United States time, and delivered into the investor’s account at the Digital Asset Warehouse, after which point the investor can use the Bitcoin as they wish. This essentially provides a way for investors and traders to directly buy Bitcoin in a safe and regulated way, and the physical Bitcoin futures should be available on all stock trading platforms.

There are trillions of USD traded and invested on stock trading platforms, and the physical Bitcoin futures will open up Bitcoin to this immense pool of capital. To put this in perspective, Bitcoin’s market cap is USD 112 billion as of this writing on 23 October 2018, while the NYSE alone has a USD 18.5 trillion market cap, while globally the 60 major stock exchanges in the world have a market cap of USD 69 trillion. If even a small fraction of the money in stocks is diversified into Bitcoin, it could lead to the biggest Bitcoin rally in history.

There are already Bitcoin futures available on the Chicago Mercantile Exchange (CME) and the Chicago Board Options Exchange (CBOE), but the difference is these are cash settled futures and there are no bitcoins backing them. Therefore, money invested into the currently existing cash-settled futures does not increase spot demand for Bitcoin. The physical Bitcoin futures on Bakkt will directly increase spot demand for Bitcoin.

Other details about the Bakkt physical Bitcoin futures include the contract size which will be 1 bitcoin, the contract symbol will simply be BTC, and trading for each daily contract will occur from 8 pm to 6 pm Eastern United States time with a pre-open at 7:55 pm. Therefore, unlike Bitcoin spot exchanges, there will be a couple of hours each day where the market is closed for physical Bitcoin futures. The physical Bitcoin futures will be listed on the ICE Futures U.S. exchange, and the clearinghouse will be ICE Clear U.S.

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Bakkt Re-Affirms Imminent Physical Bitcoin Futures

It’s been about two months since the Bakkt cryptocurrency exchange was announced by the Intercontinental Exchange (ICE), along with the groundbreaking announcement that it would offer the first officially licensed and regulated physical Bitcoin futures in the United States.

Bakkt has re-affirmed that these physical Bitcoin futures are on the way as of 25 September 2018, and everything appears on track for them to launch in November 2018, little over a month from now. The exchange is saying that physical Bitcoin futures will be available in GBP and EUR in addition to USD.

Our first contracts will be physically delivered Bitcoin futures contracts versus fiat currencies, including USD, GBP and EUR. For example, buying one USD/BTC futures contract will result in daily delivery of one Bitcoin into the customer’s account.

— Bakkt (@Bakkt) September 25, 2018

Currently, the only Bitcoin futures available are cash-backed and cash-settled futures on the Chicago Mercantile Exchange (CME) and the Chicago Board Options Exchange (CBOE). Since these Bitcoin futures in Chicago are entirely backed by cash and settled for cash they can be considered paper Bitcoins. Investors purchasing paper Bitcoins in Chicago do not increase spot market demand and in fact, divert money away from Bitcoin spot markets long term.

Additionally, shorting Bitcoin futures in Chicago probably leads to market manipulation that causes Bitcoin’s price to go down, particularly around the time monthly futures contracts expire. It appears traders could be manipulating Bitcoin spot markets to crash to increase short sale profits from future contracts.

The Bitcoin futures that will probably be launched by Bakkt in November 2018 will be the first physical Bitcoin futures. They will be settled for actual Bitcoins on a daily basis, meaning an investor who buys Bitcoin future contracts on Bakkt will directly receive Bitcoins into their accounts on the same day when contracts settle. This means that physical Bitcoin futures contracts on Bakkt will directly increase spot demand for Bitcoin and, therefore, increase global Bitcoin price.

Effectively, the physical Bitcoin futures contracts on Bakkt will allow traders and investors to buy Bitcoin in a safe and regulated way, ideal for institutional investors. It is likely that the physical Bitcoin futures contracts on Bakkt will be available on all major stock trading platforms as well, which could pave the way for a major Bitcoin rally.

 

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Bitcoin Price Analysis, 25th May 2018: BTC/USD Met With Resistance Below $7500

Bitcoin appears to be coming under a bear market with signals indicating dramatic shifts in the sentiment of traders. Prices keep being in a downward spiral now with volumes also coming down.

The Day’s Signals

  1. Bitcoin prices fell from the day’s peak at USD 7,700 price levels with a drop down to USD 7,300 levels earlier today.
  2. While a recovery was realized above USD 7,500 prices, a selloff had traders taking consideration at USD 7,400 levels.
  3. Selling pressure now seems to be forming a resistance level below USD 7,500.

bitcoin gdax-btcusd-May-25-2018-23-58-58

GDAX BTC/USD charts are indicating the shattering of support levels with today’s downward spike. While markets did recover, the downtrend keeps prices from rising. Through more recent hours, a fall further down to USD 7,300 levels keeps seeming more plausible. It’s obvious that consideration after the recovery didn’t manage to last too long. Traders succumbed to a bearish breakout with the downward spiral even continuing after it. It’d be safe to assume that resistance levels might be starting to form below USD 7,500 levels with the markets even being vulnerable to further price falls as volumes remain low.

Bitcoin okcoin-btcusd-weekly-futures-May-25-2018-23-59-7

OKEX BTC/USD charts showcase that futures traders are continuing to support closely mirroring spot prices. There hasn’t been much space for a difference between the two markets with so much uncertainty around. Traders in markets for bitcoin futures have surely gotten wind of the worsening market sentiment that’s driven by uncertainty. With trading volumes continuing to go down from being already low in previous trading sessions, not much confidence can be placed in markets.

All in all, traders seem to be preparing for even worse outcomes in spite of the already worsening conditions experienced in bitcoin markets. Volumes kept going down in spite of already being low in previous trading sessions. It is such signals that lead traders to exercise more caution and ultimately markets end up with even thinner support. With new lows reached through yet another day, indicating that there’s no positive sign showing that the downtrend might be close to an end.

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Bitcoin Price Analysis, 18th May 2018: BTC/USD Recovers From Sub $8,000 Slump

The day’s trading session was followed by notable volatility with bitcoin price falling to a low of 7,950 levels. However, the breach below USD 8,000 did not last long as prices recovered briefly. In the more recent hours, markets keep trading around USD 8,200 levels following a recovery.

The Day’s Signals

  1. A major selloff caused prices to go from USD 8,200 levels to hovering above USD 8,000.
  2. The followup to the downward spike included yet another selloff that this time caused a breach below 8,000.
  3. Interestingly enough, the breach appears to have kickstarted a wave of buying pressure. Such trend is not yet showing any signs of longevity though.

bitcoin gdax-btcusd-May-19-2018-6-21-20

GDAX BTC/USD charts are indicating that support for USD 8,000 might be underlying. The fact that a breach was observed today wouldn’t normally bring confidence, but the market’s reaction begs otherwise. Traders shouldn’t be too quick to judge of course, as the day’s trading volumes have gone down in comparison to the last few days. Big orders causing price spikes appear to be a driving force in today’s trading session. The market’s response to the spike that pushed prices to a breach certainly does showcase some support though. The market taking consideration on the recovered USD 8,200 brings on a more positive outlook in the following of a breach.

bitcoin okcoin-btcusd-biweekly-futures-May-19-2018-6-27-23

OKEX BTC/USD weekly futures showcase a tendency of futures traders to exaggerate selling pressure to an extent, which becomes more apparent at the time of the day when greater selling pressure was observed. Futures markets did, however, break out of this sentiment with prices moving up again. The difference in futures prices and markets rates grew to a bigger difference with futures maintaining higher prices.

In summary, today’s response to the sizable downward spike that was experienced was notably positive. It’s worth pointing out that markets appear to be on an overall downtrend over the span of this week. With that in mind, support for a recovery after a breach might showcase that underlying support could be holding up for USD 8,000 levels. Of course, a day with decreased volumes would not set a sentiment of support in stone. For that reason, the sustainability of the recovery remains to be seen.

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Bitcoin Price Analysis, 16th May 2018: Bitcoin Markets Stagnant Above $8,000

Bitcoin markets appear to have a hard time finding sustainable support above USD 8,500 levels. Even after the bullish breakout experienced only a couple of days ago, markets are again experiencing a dip, this time reaching low levels of USD 8,100.

The day’s signals

  1. Large sell0ffs crashed Bitcoin prices down from USD 8,500 levels where BTC/USD was at in the earlier hours of the trading session.
  2. The crash appears to be a continuation of the downward trend. This trend appeared following Bitcoin markets reaching a top above USD 8,800.
  3. Volatility still appears to be in play but this time around, leaning towards overall bearish sentiment.

bitcoin gdax-btcusd-May-17-2018-6-37-45

GDAX BTC/USD charts are showcasing the market’s mood through a couple of interesting patterns. The first is an apparent market disdain when it comes to following up on positive price movements. The major crash for the day caused prices to drop from USD 8,500 levels down to USD 8,100 levels. With markets taking consideration for a few hours, traders achieved a recovery reaching slightly below USD 8,400 levels. Some brief consideration ensued and then yet another dip, this time with prices reaching a low at USD 8,200 price levels. From there on, prices have been pressured against reaching USD 8,400 levels again.

bitcoin okcoin-btcusd-quarterly-futures-May-17-2018-6-37-48

OKEX BTC/USD weekly futures still appear to be maintaining some positivity. Futures traders are keeping up the positive difference between futures rates and live market prices. That’s in continuation to the recently reached peak. A breach in the now sideways trailing prices could potentially limit that positive difference substantially. The recent hours where volumes have gone down leave markets especially vulnerable to another breakout that could end up being negative.

All in all, traders are certainly more cautious after the day’s volatility proved support hasn’t come on to back prices above USD 8,500.  Interestingly enough though, while volumes have gone down, prices are now managing to rise under this setting. However, support for even the current levels proved to be unreliable throughout the day. The way Bitcoin markets are playing out, there’s no wonder traders appear skeptical in this moment.

 

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