Newly launched bitcoin futures on Monday suggested that traders expect the cryptocurrency’s blistering price gains to slow in the coming months, even as it blasted above US$17,000 to a fresh record high in the spot market, Reuters reports.
Chicago-based derivatives exchange Cboe Global Markets launched the futures late on Sunday, marking the first time investors could get exposure to the bitcoin market via a large, regulated exchange.
The one-month bitcoin contract opened at 6 p.m. local time on Sunday at US$15,460. By late afternoon on Monday in New York, it was trading at US$18,650, roughly 8 percent above bitcoin’s spot price of $16,900 on the Bitstamp exchange BTC=BTSP.
Bitcoin earlier hit a record high of $17,270.
Its steep gains and rapid rise have attracted investors around the world as well as intense scrutiny from government regulators, which is the very opposite of what its creators wanted when it first launched bitcoin more than eight years ago.
“The bitcoin founder should be horrified seeing it rise so quickly, as any serious focus on it and its recent explosive move higher will soon end its freedom,” said John Taylor Jr, president and founder of research firm Taylor Global Vision in New York.
Taylor believes that based on his charts, bitcoin has not yet peaked, but as soon as the “upmove ends, it will crash”.
Given bitcoin has almost tripled in value over the past month, and was up more than 15 percent on Monday alone, the futures pricing suggested investors see price increases moderating.
Bitcoin futures were already offered 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 wider use.
The CME Group (CME.O) is expected to launch its futures contract on Dec. 17.
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