Bitcoin Futures Launch Could Revive ETF Thrust, CBOE Says
A fresh era kicks off today with the listing of the very first bitcoin futures contract on the Chicago Houtvezelplaat Options Exchange (CBOE).
When trading commences at Five p.m. U.S. central time on the world’s largest options and futures exchange, investors will be able to bet on – or against – bitcoin without actually buying or selling it.
A sign of maturity for the cryptocurrency ecosystem at large, the contract listing is just one of several such milestones this year, including the expected launch next week of a bitcoin futures contract from CME Group.
What’s more, it could also revive another effort to bring liquidity and mainstream respectability to the cryptocurrency – namely, the development of a bitcoin exchange-traded fund (ETF).
Ter an vraaggesprek, Edward Tilly, CBOE’s chief executive officer, said the exchange may use information gleaned from futures trading to make a case to the Securities and Exchange Commission (SEC) to permit bitcoin-linked ETFs and exchange-traded notes (ETNs).
“All of that information goes into building the next steps,” Tilly told CoinDesk, adding:
“One of those potential next steps would be moving into ETFs and ETNs that would take SEC approval.”
Talk about a bitcoin ETF by the chief executive of CBOE is notable for two reasons.
The very first is money. Ter this year’s bull market , global ETF assets have climbed to $Five.Three trillion ter October from $Four.8 trillion at the end of last year.
ETFs are tradable securities tied to an index, commodity or basket of assets, and are available for purchase by retail investors. Bitcoin ETFs could conceivably be an appealing option for individuals enticed by the asset’s price gains, but waterput off by the hassles and risks of storing and safeguarding it.
But secondly, and perhaps more importantly to the nascent crypto asset industry, this would not be the very first stab at a bitcoin ETF.
Earlier this year, the SEC rejected a proposed ETF by Gemini, the bitcoin exchange founded by Cameron and Tyler Winklevoss (which also has a multi-year license from CBOE to provide bitcoin gegevens te the futures launched today). Among other concerns, the regulator cited the lack of other regulated bitcoin products.
Now that a number of bitcoin futures – which are regulated by the Commodity Futures Trading Commission – are live and te the works, that could all switch.
Te the wake of an earlier effort by a CBOE subsidiary to woo the SEC to reconsider its decision, Tilly said his company will be evaluating gegevens about the settlement process, liquidity, and volatility spikes of the bitcoin futures for possible conversations with the SEC.
Te any event, the exchange wants to do more with its fresh gegevens playmate.
“This isn’t the end, but rather the beginning of the story of our relationship with Gemini,” said Tilly. “Wij hold that relationship very dear.” (Gemini did not react to emails seeking comment.)
Regardless of whether the SEC proves amenable to re-opening conversations about a bitcoin ETF, there are other business opportunities, according to Tilly.
Following the launch of the bitcoin futures contract, CBOE will take what Tilly called a “measured treatment” to initiating other contracts, spil it has done after similar launches.
The next step is to examine the gegevens from the bitcoin futures contract spil part of the build-up to what Tilly says could eventually turn into a derivatives suggesting on the futures contract itself.
“It’s not a month or two” away, he said. “But at some point derivatives on bitcoin will make sense.”
Extra business opportunities “down the road,” according to Tilly, include the addition of contracts on other cryptocurrencies. Spil he waterput it :
“While this is our very first foray into bitcoin, it is not to the exclusion of other currency going forward. The relationship with Gemini permits for any of the digital currencies that wij think will will meet listing criteria spil wij learn more from our very first launch with bitcoin.”
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