The Game Changer: Bitcoin Futures

The Game Changer: Bitcoin Futures

Bitcoin price rose slightly on Tuesday as investors eye the upcoming launch of bitcoin future contracts. According to industry website CoinDesk, the price rose 0.28 percent to $11,649.58 during Tuesday’s trading session. Institutional interest in the cryptocurrency market continues to increase as more exchanges are coming on to provide bitcoin-related derivatives. According to Bloomberg, Japan’s financial exchange, Tokyo Financial Exchange Inc., plans to create a working group for cryptocurrency early next year. Chief Executive Officer Shozo Ohta told reporters on December 1st that, “Once the Financial Instruments and Exchange Act recognizes cryptocurrencies as financial products, we will list the futures as quickly as possible… To achieve that, we will launch this working group to study various aspects, including bitcoin’s present status, its outlook, and what form it will take root in Japan’s society.”

The move by Tokyo Financial Exchange came when two U.S. exchanges announced to begin bitcoin futures trading this month. CME Group Inc, said it will launch bitcoin futures contracts on December 18th, while Cboe Global Markets Inc. announced to offer trading in bitcoin futures on December 10th. Japan is one of the countries that recognized bitcoin as a legal form of payment and accounted for most of the bitcoin trading volume. According to CryptoCompare, Bitcoin treading volume by Japanese yen accounted for about 50 percent of the total trading volume.

With over $2 billion of digital assets under management amongst its 100 crypto hedge funds and individual investors, the BIC pools its members’ experience and expertise in shared due diligence to identify co-investment opportunities in the most promising and disruptive blockchain enabled companies. Members of the BIC have made notable investments such as Ethereum’s initial crowdsale, Coinbase, Bancor, EOS, Tether and have several early BTC investors.

“Blockchain is a technology that requires collaboration to thrive, which is why so many companies are electing to work together to enable their mutual success. The open and distributed ledger characteristics of blockchain development, deployment and setting of standards is reflected in the behavior of the most successful investors in this space, like the BIC,” said Shafin Diamond Tejani, Chief Executive Officer of Victory Square. “As an early proponent of Blockchain entrepreneurs and companies, the Victory Square team is excited to participate in this exclusive group of successful crypto investors.”

The Blockchain Investors Consortium carefully selects the top Blockchain and cryptocurrency companies to present at their events across the globe. Victory Square’s inclusion in this elite investment group will grant access to promising early-stage ventures, while also allowing Victory Square to leverage the experience of a network of seasoned and successful cryptocurrency investors. This will further strengthen Victory Square’s position as a pioneer in investment in Blockchain enterprises both in Canada and abroad.

“We’re extremely excited to have Victory Square join the Blockchain Investment Consortium,” said Mike Costache, Founder of BIC. “They have a proven track-record of incubating and investing in successful platforms and will play an important role in performing shared due-diligence to identify the most promising investment opportunities. We continue to align ourselves with key global strategic partners who will enhance our group’s ability to identify and deploy capital into promising blockchain ventures.”.”

Xunlei Limited (NASDAQ: XNET), a leading cloud-based acceleration technology company in China, on November 29th, provided the following clarification on the recent market development. Currently, Xunlei has 28.77% equity interest in Shenzhen Xunlei Big Data Information Services Company Ltd. (“Big Data”) and has no management control over Big Data. In response to certain public statements made by Big Data recently, the board of directors of the Company (“Board”) issued an open letter and firmly supported the Company’s endeavor to utilize its many years of technical know-how in the field of distributed computing to explore commercial applications with the help of blockchain technology. When developing blockchain technology, the Company utilizes such features as openness, transparence and security for their applications. Wankebi is only a symbol of proof for these applications, rather than a subject of speculation.

Cboe Global Markets, Inc. (NASDAQ: CBOE), one of the world’s largest exchange holding companies, announced on December 4th, that Cboe Futures Exchange (CFE), plans to offer trading in bitcoin futures beginning at 5:00 p.m. CT on Sunday, December 10, 2017, at the start of Global Trading Hours. Monday, December 11, will be the first full day of trading, and trading will be free1 through December. Ed Tilly, Chairman and Chief Executive Officer of Cboe Global Markets, said: “Given the unprecedented interest in bitcoin, it’s vital we provide clients the trading tools to help them express their views and hedge their exposure. We are committed to encouraging fairness and liquidity in the bitcoin market. To promote this, we will initially offer XBT futures trading for free.”

CME Group Inc. (NASDAQ: CME) is the world’s leading and most diverse derivatives marketplace. Recently, the company announced that it has self-certified the initial listing of its Bitcoin futures contract to launch Monday, December 18, 2017. The new contract will be listed on and subject to the rules of CME. It will be available for trading on the CME Globex electronic trading platform, and for submission for clearing via CME ClearPort, effective on Sunday, December 17, 2017 for a trade date of December 18. 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 U.S. dollar price of bitcoin.

Blockchain, originally developed as a supporting technology for cryptocurrency Bitcoin, is a distributed ledger that tracks transactions, connecting them to other transactions nearby and securely encrypting the information. This ledger technology has proved to be the larger value of cryptocurrencies, with implications for almost every industry, not just tracking digital currency. The business value-add of blockchain is expected to grow to more than $176 billion by 2025, and to exceed $3.1 trillion by 2030, according to Gartner. The financial industry for example can use blockchain to redesign costly legacy workflows, improve liquidity, and free up capital. The technology can also help reduce infrastructure costs, increase transparency, reduce fraud, and improve execution and settlement times.

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S. Jack Heffernan Ph.D. Funds Manager at HEFFX holds a Ph.D. in Economics and brings with him over 25 years of trading experience in Asia and hands on experience in Venture Capital, he has been involved in several start ups that have seen market capitalization over $500m and 1 that reach a peak market cap of $15b. He has managed and overseen start ups in Mining, Shipping, Technology and Financial Services.

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