If any CME members or maybe CME Chairman himself are reading this forum, or if someone has access to higher ups in CME, maybe its a good idea to use your contacts to suggest them to introduce BitCoin futures. Who cares if the digital currency survives or not or if it changes its form etc. but I am sure futures on BitCoin will become a hit overnight. Might be a great new product for CME. Presently, people have to open a new account with Mt Gox if they want to trade spot Bitcoins. Bitcoins futures listing on CME will allow a much larger trading community access to this contract Personally I think idea of Bitcoins is in early stages of its development and government can effectively control it to some extent if they want. Especially after couple months ago raids by federal agencies. Still, as a short term intra-day speculation vehicle, from a futures trader perspective, it ought to be just GREAT - with 5-20% swings......WOW!!!! The reference spot market should be Mt Gox. This is just my opinion and ofcourse CME guys can decide to choose the one they want.
I will go on to say that if CME can't do it because of political pressure etc. other global exchanges like LME, SGX, NSE, FTSE, Eurex, Dubai etc. should introduce this contract. Its bound to become a hit.
MtGox has like $4.5 mil ADV. Thats less than nothing compared to CME rates or index products. I doubt it would be remotely worth it. It probably would have to be a cash-settled contract, and i'm not sure how well that would go down with the BTC tinfoil target audience. Besides, the CME is busy failing at getting a real FX exchange up and running since months (CME Europe). After their latest announcement to postpone launch they didnt even give a new date.
Thanks for chiming in! I agree that it should be a cash-settled contract. Futures Speculators on this contract do not want delivery of electronic bitcoins. And the tinfoil hat guys - who actually use bitcoins to actually buy/sell real stuff from online stores on the internet, they can continue to use Mt Gox and other spot exchanges and possibly try to trade the resulting basis. My point is - it will allow a large group of futures traders access to this product, which they currently don't have. I think it will be a hit product - considering that CME has exotic products like weather derivatives, variance products, futures on Bitcoins is not too exotic.
The binary option brokers are slowly starting to trade bitcoin options. Read this: http://www.binaryex.com/bitcoin-binary-option-trading/ Currently only three brokers.
1. One feature of Bitcoin is protection of identity. Trading it at a major exchange is asking for your identity to be exposed. I think a significant # of Bitcoin holders will not participate. 2. Some exchange ... being part of the gold smash scandal - a future contract on Bitcoin is asking for the same. Putting my conspiracy theorist hat on =)
that's already proven to be false, mtgox requires your identity(passport/driver licenses etc..) to trade any decent amount of money just like any other broker account, and it is the most used exchange by far, almost everyone who owns bitcoin traded on it one point or another. You may still have a few purist who cares about the philosophical idea behind bitcoin (and some criminals) but 99% of the bitcoin community could care less, they just want to make money and make the currency popular. The idea of a currency with limited supply, not controlled by any government that has the power to inflate it (or destroy it), is a far more important ideology to the community than remain anonymous while transacting. There are many people who still runs their miners even though it is not making much money after electricity cost, just to support this idea (by supporting the network) ---------------------------- The problem with bitcoin futures are many folds, all legal issues aside. 1) You cant cash settle, there is nothing to base the settlement price on, mtgox is far to small, unstable, and "shady" for cme to even look at it as spot. To settle "physical", there needs to be a settlement system built around confirming bitcoin delivery that satisfies all the futures settlement regulations. It is very doable but a significant effort. 2) Now with physical delivery, who is going to make market and create those contracts? do they need to hold bitcoins now? You are better off just doing an etf, which the winklevoss twins are doing.
I am tired of hearing of this bitcoin thing, basically all you guys into bitcoin are just going around spreading hype about bitcoin in hope of making money on your investment. Like those twin brothers. That's lame. Bitcoin looks like a Ponzi. Ask yourself who made $$ marketing bitcoin? You can't buy anything worthwhile with it, some govts are outlawing it. Maybe buying some around $1 was a punt that made sense , but anyone buiying bitcoins today is a fool, if they ever make money that will be sheer luck. As a currency it's worthless since it fluctuates like an internet stock. And if your computer goes down or the internet, you have no access to your money. How good is money you can't use or that could even be wiped out by some system malfunction ? I am not even mentioning the hacking issues that are a real nightmare. So stop dreaming about bitcoins on the CME. And I hope that the twins get prosecuted for spreading hype after they massively invested in bitcoin. Their idea of floating a bitcoin ETF is not only a sign of the times but really just an outrageous Ponzi scheme . What need is there for a bitcoin ETF other than pumping the value of their bitcoin holdings ? None .