Cboe Futures Exchange launches Bitcoin Futures
5 December 2017
Cboe Futures Exchange, LLC (CFE) have announced December 4 that beginning at 5pm in Chicago on Sunday, December 10 they will begin trading Bitcoin futures. Monday, December 11 will represent the first full day of trading. CFE said trading will be without any exchange fees throughout December 2017. The contracts are subject to oversight by the Commodity Futures Trading Commission (CFTC).
CFE’s hometown rival, CME Group Inc. (CME) have said that its own Bitcoin futures contracts will begin trading on Monday December 18 2017. Nasdaq, LedgerX and the Tokyo Financial Exchange also have plans to launch Bitcoin futures soon.
The Bitcoin futures contracts, known as XBT futures, will require a 33 percent initial margin requirement, whereas CME will require 35 percent to back the trades in its clearing house. CFE’s contracts are cash-settled based on a daily auction price from Gemini Exchange, the virtual currency exchange run by twins Cameron and Tyler Winklevoss. Investors may not own or control more than a net 5,000 contracts, long or short combined, with a minimum block trade quantity of 50 contacts, and the global market will be open for more than 23 hours a day, five days a week.
CME’s Bitcoin settlement price is a composite derived from four Bitcoin exchanges. Different from CFE, CME is planning to limit the amount of contracts investors can own or control to no more than 1,000, which is equivalent to less than one percent of the total market available to trade at CME.
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