World's First Bitcoin Futures to Start Trading

World's First Bitcoin Futures to Start Trading

Cboe's bitcoin futures will trade on CFE under the ticker symbol 'XBT.' XBTSM futures are cash-settled contracts based on Gemini's auction price for bitcoin, denominated in USA 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.

CME Group said trading would be available on its CME Globex electronic trading platform from 18 December.

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CME Group's Bitcoin futures will be cash-settled, based on the CME CF Bitcoin Reference Rate (BRR) which serves as a once-a-day reference rate of the USA dollar price of bitcoin.

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The fact that this price was achieved much before the end of the year and that the prices overshot this region to move beyond the $11,000 region during the month was a sample of how strong this bull run has been during the month of November. 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. It was trading Friday at around $10,500, after being worth roughly $1,000 at the beginning of the year.

Naeem Aslam, Think Markets analyst, said that the reports Britain wants to hike regulation of bitcoin and other digital currencies. The Cantor Exchange took similar steps to begin trading new binary bitcoin options contracts. Bitstamp, GDAX, itBit and Kraken are the constituent exchanges that now contribute the pricing data for calculating the BRR.

The cryptocurrency was last up 0.7 percent at $11,324.

However, despite the cash-settlement process, some institutional investors have expressed concern at the addition of bitcoin-derived products to CME. The first bitcoin futures contracts on a regulated USA exchange are set to launch on Sunday.

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