Bitcoin Futures Investigated by Nasdaq

When China banned crypto-trading in November 2017, a lot of investors were disheartened. But the market quickly recovered as they moved offshore to Singapore, Hong Kong, and South Korea. And then the latter threatened to ban them as well, and the downfall started when other global governments considered following suit.

Even though BTC had almost reached 20,000 dollars per unit in value at the beginning of December, that value soon halved and even dropped below the 10,000-dollar mark. Small investors fled like rats off a sinking ship, but seasoned traders put on their game face and carried on through the turmoil.

The past few months have been rough on cryptocurrency trading, to say the least. But signing up for an FX simulator to test the crypto market once more might have just become a good idea again, thanks to Nasdaq stepping in with a bold project. Yet, others aren’t as confident. Let’s find out what’s new in the realm of Bitcoin.

Nasdaq Steps In

In a statement for CNBC, Adena Friedman, the CEO of Nasdaq, stated that “[they] are continuing to investigate the idea of a cryptocurrency futures (contract) with a partner and [they] continue to look at the risk management around that, making sure [they] are putting the right protocols in place, making sure there’s proper demand, and that the contract is different from what’s already out there.”

This comes as no surprise, seeing how rival groups CBOE and CME have already launched similar initiatives in the past few months. However, Friedman assured investors that Nasdaq aims to approach matters differently from the other companies which provide this product. In this way, they will ensure that they provide their clients with something new.

While CBOE and CME track the price of Bitcoin and operate referring to its future value, what Nasdaq wants to analyze are total return futures. This will make the entire process “more of an investment than a tracking stock”, according to Friedman. Nevertheless, the team in charge of this project will decide if the entire initiative makes sense after close consideration.

What they will need to look at first and foremost is client demand. Risk management is also an important aspect that will determine the project’s rate of success. But if things look promising, then Nasdaq will take it to Commodity Trading Futures Commission (CTFC) and turn the speculation into reality.

Mixed Opinions 

There are a lot of people out there who are still optimistic about the future of Bitcoin, as well as other cryptocurrencies, on the forex trading market. Crypto-trading firm founders Dave Chapman and Julian Hosp both see big things for BTC in 2018. While Hosp is a bit more moderate in his beliefs, Chapman went as far as to state that it will break the 100,000-dollar market cap soon.

On the other side of the table, well-known names such as renowned trader and investor Warren Buffett, also known as the Oracle of Omaha, aren’t as bright and cheery. In fact, Buffett predicted a “bad ending” to the entire virtual currency debacle, and the recent cryptocurrency bloodbath of December 2017 and January 2018 seems to be the first step in that direction.

Other big players, such as J.P. Morgan CEO Jamie Dimon, aren’t too fond of Bitcoin either. In fact, Dimon notoriously referred to cryptocurrencies as being a “fraud”, a world telling enough of his opinion on the matter. And to top it all off, Nobel prize-winning economist Robert Shiller stated for TIME Magazine that BTC will eventually collapse and be forgotten.

Shiller is most notorious for having predicted the burst of two of the most major bubbles in modern financial history, namely the dotcom one, and that of housing before it. And referring to Bitcoin and other cryptocurrencies just before the bloodbath started leading up to Christmas, he said that it’s bound to go down sooner or later.

Final Thoughts 

Nasdaq’s Bitcoin futures project might just be the helping hand this market needs to recover. Nevertheless, many important voices of dissent have made themselves heard, which leads everyone to still see the eventual outlook as unclear. At this point, only time will tell what comes next.