Bitcoin rebounds after U.S. regulator approves futures

At the same time, the Commodity Futures Trading Commission (CFTC) also announced that Cboe Futures Exchange (CFE) has self-certified new contracts for Bitcoin futures products, and that the Cantor Exchange (Cantor) has self-certified a new contract for Bitcoin binary options.

The U.S. derivatives regulator said on Friday it would allow CME Group Inc and CBOE Global Markets Inc to list bitcoin futures, after the rival bourses showed their proposed contracts and trading arrangements met necessary requirements.

Derivatives marketplace operator CME Group will launch a bitcoin futures product on December 18, ending speculation as to when the much-anticipated offering would be available on the USA markets. "We are operationally ready and we will be announcing a launch date shortly", the spokesperson said in the new statement. On Wednesday, bitcoin smashed through $10,000 U.S. before rocketing past $11,000 United States less than 12 hours later to an all time-high of $11,395 USA, and then plunging around 20 percent in the hours that followed. "This opens up the doors to exchange traded funds and institutional money". Friday, bitcoin was trading near $10,100 before the news broke, and jumped above $10,650 afterward, according to CoinDesk. It was last up 6.6 percent at $10,600. While CFTC approval isn't required, the regulatory body could have halted the CME's plans if it wasn't satisfied with the self-certification.

The regulator will monitor trading in these products and will assess whether any changes are needed to the contract design and settlement processes.

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The bitcoin price rallied to a 24-hour high following the announcement that US derivatives exchange CME has self-certified to list bitcoin futures contracts in mid-December. "Nevertheless, investors should be aware of the potentially high level of volatility and risk in trading these contracts", Giancarlo adds.

Still, at launch, Duffy explained the bitcoin futures product will be subject to risk management tools, including a margin of 35 percent, position and intraday price limits.

CME has been vying with CBOE to introduce the first bitcoin-related financial product.

  • Darren Santiago