Bitcoin prices surge as futures make their US debut on the CBOE

11 Dec 2017

Bitcoin is surging in value. Image: Jiri Hera/Shutterstock

This is the first time bitcoin has been traded on a major exchange.

Bitcoin futures launched on the Chicago Board Options Exchange (CBOE) yesterday (10 December) as cryptocurrency value continues to surge. Many people are viewing the addition of bitcoin to the CBOE as a step towards the mainstreaming of the cryptocurrency.

According to The Guardian, the CBOE futures are securities that will track the price of bitcoin on Gemini, one of the larger existing exchanges. They will allow trading based on the movements in the prices of the cryptocurrency, without any ownership of the currency itself.

Bitcoin futures are a reality

The kick-off of trading caused the CBOE website to experience some downtime.  “Due to heavy traffic on our website, visitors to may find that it is performing slower than usual and may at times be temporarily unavailable,” said a statement from the exchange.

The Chicago Mercantile Exchange (CME) will be trading its own futures on 18 December, but will be using a composite of several bitcoin prices across a number of exchanges.

The futures were launched on the CBOE under the XBT ticker symbol, and the new contract expires in January. Prices rose from $15,460 to $16,000 in the first few hours of trading. In 2017, bitcoin jumped more than 1,000pc in value and, according to CNBC, it briefly broke above $19,000 on the Coinbase exchange last week before dipping back down.

Legitimising bitcoin?

Some experts are saying the launch of futures gives bitcoin a form of legitimacy that could make it more attractive to traditional investors who would previously have been reluctant to get involved.

The US Commodities Futures Trading Commission was the organisation that made the CBOE and CME launches possible, but it has also warned investors about the volatility and risk associated with trading in bitcoin. The CEO of Coinbase, Brian Armstrong, reminded interested parties of the risks in a blogpost, saying:  “Digital currencies are volatile and the prices can go up and down.”

He also warned Coinbase account holders to take the necessary security measures, such as two-factor authentication, to keep their accounts secured. This warning came as the Coinbase app hit the top of the App Store last week, signalling a massive spike of public interest in the world of cryptocurrency.

Ellen Tannam was a journalist with Silicon Republic, covering all manner of business and tech subjects