Bitcoin futures rocket past $18000; Asian shares buoyant

Gladys Abbott
December 12, 2017

Charles Schwab and TD Ameritrade have said that for now, they are not allowing trading of bitcoin futures.

Bitcoin's abrupt rise has prompted warnings of an increasingly risky speculative bubble.

Among those cheering the launch are the Winklevoss twins, who have been called the first bitcoin billionaires. It increased 8 percent in less than 10 minutes after trading began. The futures markets would be open at all times, similar to Bitcoin trading that has no official sessions. Globally, about $1.1 billion of bitcoin traded against the U.S. dollar during the same period, according to Cryptocompare.com.

The Cboe said at least 20 trading firms "actively participated" in the first day of trading, without giving specifics.

The two launches were made possible after a key United States regulator, the Commodities and Futures Trading Commission (CFTC), gave the green light to the exchanges on December 1, while warning "of the potentially high level of volatility and risk in trading these contracts".

A futures contract is a tradable legal agreement that entitles its holder to buy or sell a particular commodity or financial instrument at a predetermined price at a specified time in the future. The Futures Industry Association - a group of major banks, brokers and traders - said this month that contracts in the United States were rushed without enough consideration of the risks.

Within three hours after its listing of bitcoin futures, the website and online trading platform of the Chicago Board Options Exchange (CBOE) were inaccessible, due to an unexpected spike in demand and volume.

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Still, interest in the new market appeared to put pressure on Cboe. In an interview on business network CNBC, North American Securities Administrators Association President Joseph Borg said he observed some people taking out mortgages on their house to buy bitcoin.

Blankfein became the latest boss of a major bank to criticize bitcoin, after JP Morgan's chief executive Jamie Dimon described it as fraud that would ultimately blow up.

The latest surge brought its so-called market cap, its price multiplied by the number of bitcoins in circulation, to almost US$280 billion, according to Coinmarketcap, a trade website.

The bitcoin prices have been very volatile over the weekend as the prices dipped towards the $13000 region only to recover as we headed to the end of Sunday and the prices have since bounced back to the $16000 region as of this writing and seems to be ready for another bullish leg.

Some investors said they still see scope for bitcoin to soar even higher.

According to Yuji Nakamura, a Tokyo-based technology journalist, CBOE bitcoin futures processed $401,600 worth of trades within the first 20 minutes.

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