The last growth phase of cryptocurrency ceased 17 December 2017. On this day Bitcoin has set a maximum course and flew down. Immediately after that, the records came from altcoins, but the euphoria was short-lived. In General, the beginning of the market decline coincided with the launch of Bitcoin futures on CME from. Do they really burst the bubble of the last cryptocurrency?
Recently raised this issue again. Recall, October 23, we wrote about an interview with former Chairman of the Commission on trade in commodity futures Christopher Giancarlo. Then he expressed confidence that the launch of futures proved to be a strategic move of the administration to trumpto break Bitcoin bubble.
However, when asked about this global head of index equities and alternative investment products at CME Group Tim McCourt, he categorically rejected the theory of the influence of futures on Bitcoin.
Many times they asked, could the launch of futures to derail Bitcoin from 20 to 3 thousand dollars. No, I could not.
Says McCourt, CME started with 1100 futures contracts. At the end of 2017 , this segment had approximately $ 100 million. In such a short period of time given the size of the market for Bitcoin futures contracts could not influence its price.
Given the size of the Bitcoin market, spot trading or the possibility of mining BTC, futures could not affect the price of the cryptocurrency. Such is governed by the law of supply and demand. We simply do not have the resources and ability to implement such a blow.
We will remind, at the peak of the rate of capitalization of the first cryptocurrency was 330 billion dollars.
It should be noted, since the volume of Bitcoin futures on CME has grown considerably. When in may of this year, BTC jumped sharply to the level of 8,000 USD, daily trading volume reached 13,600 contracts or 68000 BTC. In dollar terms this 515 millionthat at least five times more than at the end of December 2017. Does this mean that now this sector has a greater impact on the price of Bitcoin? Here is the answer of Tim.
Of course, we play a role in pricing, since people can freely Express their requirements for the purchase and sale by CME. But it is unlikely it may in any way affect the price of BTC.
Useful facts: Bitcoin futures on Bakkt — like eight-lane highway.
In anticipation of the ETF on Bitcoin
Not so long ago any hope of a BitcoinETF broke another refusal SEC. This time it rejected the application from Bitwise Asset Management. According to the SEC commissioners, the Bitcoin market is yet insufficiently ripe to launch such tools.
In addition, representatives of the Commission on securities and stock exchanges remain convinced that Bitcoin is vulnerable to potential manipulation on the emerging market. According to Tim McCourt, it’s hard to deny the growing interest in more sophisticated and “adult” trade cryptocurrency.
Read on: How futures help predict the future price of Bitcoin?
McCourt also said that ETF on Bitcoin ever will be approved, as this tool also helps to improve the detection process of the asset price.
It is undeniable that trade BTC and Bitcoin derivatives already exists, and it’s not going anywhere. Among the clients of CME is, as ETF providers and asset managers. They use our futures products to create other ETFs for hedging structural projects and we certainly would like to give them the opportunity to do the same thing with Bitcoin.
This is not the first step towards the big money for the world of cryptocurrency this week. Recall, on the eve platform Bakkt opened a custodial service for all comers institutional investors. We looked in detail at the situation in this article.
In the end, the representative of CME Group is confident that futures did not affect Bitcoin in December 2017. In his opinion, the price is quite logical and predictable fell because of the huge number of people willing to sell their coins at a high price. And the greater the range of goods on the market, the more sellers are willing to reduce the price. Hence the drop.
The current rate of coins you can see in the class ranking cryptocurrencies, and in cryptodata traders there are many more other useful information.
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