Markets

Cboe to Launch Bitcoin Futures Trading on Sunday

Cboe to Launch Bitcoin Futures Trading on Sunday

Cboe Global Markets Inc. said Monday it will start trading bitcoin futures on December 10, after getting the green light last week from regulators. Bitcoin itself is now bought and sold on platforms that are virtually unregulated, which has made some money managers uncomfortable with the market even as prices soar.

CME Group said trading would be available on its CME Globex electronic trading platform from 18 December. The futures will be cash-settled contracts based on Gemini's auction price for bitcoin, denominated in US dollars.

Trading will begin, under the ticker symbol "XBT", at the start of global trading hours at 6 p.m. ET, and will be free through December.

The cryptocurrency was last up 0.4 percent at $11,290.

CME and CBOE have also agreed to enter into data-sharing agreements, particularly on the settlement process, so the CFTC can conduct its own surveillance on the new financial contracts.

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Bitcoin futures would allow traders to bet on rises and falls in the digital currency, similar to the way oil, corn or gold futures work.

Although the futures have yet to begin trading, Cboe president Chris Concannon has already hinted that the exchange may soon launch futures contracts for ether and bitcoin cash, according to a Business Insider report. At the time in August, the CBOE was working with New York-based bitcoin exchange Gemini, which is run by investors Cameron and Tyler Winklevoss, ahead of the launch.

Last week, a JPMorgan global markets strategist forecast that the introduction of bitcoin futures would legitimize cryptocurrency in the eyes of both institutional and retail investors, transforming the cryptocurrencies into "an emerging asset class". While CME's announcement sent bitcoin's price hurtling past the $11,000 mark for the second time last week, CBOE's release hasn't had the same effect.

The Commodity Futures Trading Commission said it had discussions with the exchanges to protect consumers from extreme price swings.