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RE: How Bitcoin Futures Will Affect Price
@cryptovestor - I've been a stock futures/options trader for over 10 years and the volatility of BItcoin is way too much to expect institutional investors to buy BTC futures (or Short sell them). This kind of volatility could make speculators millions in no time and could make institutional investors go bust likewise also - unless of course the exhchanges put enforced circult limits.
Anyway, the thing to take out of this is that institutional investors have finally now started taking Bitcoin more seriously and that could lead to huge price inflation once more money starts flowing into bitcoin.
Also the Black-Scholes valuation of contracts would make the premiums very very high due to underlying volatility.
However, as best as I understand the proposed contracts will be cash settled in USD which implies that even a dreaded short squeeze of naked contracts will not automatically mean a rush to buying BTC to cover the positions.
From what I know there won't be Bitcoin options contracts only futures.
But you're right if options were to be introduced, the implied volatility will result in very high premiums.
Futures may divert money AWAY from Bitcoin
https://steemit.com/bitcoin/@rockwellontherun/bitcoin-what-will-happen-tomorrow-when-futures-start
Nobody knows what is gonna happen but, the sure thing is that this is gonna be the next source of speculation, once that Chinesse are out, and I think this could be a bad thing for crytpo because they are melting with the people that had alwayd created bubbles, which could affect very much bitcoin and cryptos in general.
Pretty slow so far. CBOE has scared off most potential early speculators with lots of warnings
https://steemit.com/btc/@davebrewer/xbtc-trading-opens-at-cboe-big-shorts-nope-slight-up-tick-in-btc-price-in-the-initial-futures-contracts