CME to open futures exchanges of bitcoin by end of year
US's largest bitcoin trading firm adds 100,000 customers in a day
The CME or Chicago Mercantile Exchange operates the world's largest futures exchange. By opening up a futures market for bitcoin, the average person, as well as professional financial firms, will be able to invest more heavily in cryptocurrencies.
Futures allow purchases of commodities at a fixed price in the present without delivery of that commodity. Investors can buy and sell shares of tangible products based on rising and falling prices with futures investing. Some experts, though, are comparing bitcoin futures to that of the Tulip disaster of the 1700's.
At that time, Tulips, a rare flower from Turkey, became very popular in Europe and the Netherlands. One of the world' first futures exchanges was created from the Tulip craze. People began buying shares of Tulips, expecting the prices to continue to climb as demand for the flower skyrocketed with people willing to pay exorbitant prices to possess the flower.
People became instantly rich in the market by selling at the right time, which attracted even more investment. But others held on too long or entered the market too late with some losing their life's fortunes after the craze stopped and people realized it was just a flower.
Bitcoin surged to records after the CME news and hit an all-time high of $7,454.04 on Friday, according to CoinDesk.
The digital currency has come a long way from being the focus of a small group of cryptocurrency enthusiasts and online marketplaces for illegal goods. An entire industry has now emerged with businesses that "mine" bitcoin, sell digital mining equipment and offer Bitcoin trading services. From CNBC.
No comments:
Post a Comment