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RE: What do the introduction of Futures Products really mean for the price of Bitcoin?
The thought that I have is that this may allow certain Wall Street groups to open positions in the actual coins, knowing that they can hedge their risk using the futures markets, making the perceived risk in owning bitcoin less than before. I am guessing that there are some investment groups that haven't gone into bitcoin because of the perceived risk, if this eliminates even a portion of that risk they may enter the crypto space.
I think the whole thing is pretty scary actually. I see futures market as the introduction of reason and technical analysis that is going to wipe a ton of the last couple weeks gains right of the table. There is as much incentive in that market to crash the price as there is to see it rise. On the positive note is that it will eventually bring stability and start crushing out the volatility.
https://www.ft.com/content/5ee5fda2-daa7-11e7-a039-c64b1c09b482
https://www.coindesk.com/bitcoin-futures-make-way-new-kind-whale/
https://steemit.com/steemit/@pawsdog/steemit-quest-for-one-million-time-required-to-build-a-usd1-000-000-00-steemit-account
This is a really good point - I didn't consider that it would allow wall street to hedge their BTC bets which they couldn't do before - thank you!
The articles always say that wall street doesn't want to worry about holding the underlying asset but that may not really be true.
Exactly. Anyone that wants to play arbitrage between the markets will be able to do so as well, and in most cases they will have to own the underlying asset, even if just for a short amount of time.
Yeah, but appart from the psychological effect, are there really buys/sells of BTC happening ? That is also my question.
There potentially could be...could minimize the risk of buying bitcoin for some of these funds. Allowing them entry points that they are comfortable with. If you are asking if the buys/sells of actual btc will take place in the futures markets, that is a no, the futures markets will be cash settled.