Bitcoin launched on the CBOE futures exchange in Chicago on Sunday, allowing investors to bet on whether Bitcoin prices will rise or fall. Bitcoin’s introduction to the CBOE has been seen by some as a step towards legitimising the currency.
The move is expected to be followed next week by a listing on the rival Chicago Mercantile Exchange.
CBOE trading saw the Bitcoin futures contract expiring in January start at $15,000 before rising to above $18,000. The contract is based on the price of Bitcoin as quoted on the Gemini exchange.
The Gemini exchange was set up by the Winklevoss twins, who were early fans of the crypto-currency and who have been called the first Bitcoin billionaires.
Bitcoin fans appear excited about the prospect of an exchange-listed and regulated product and the ability to bet on its price swings without having to sign up for a digital wallet.
Others, however, caution that risks remain for investors and possibly even the clearing organizations underpinning the trades.
The launch has so far received a mixed reception from big U.S. banks and brokerages, though. Several online brokerages, including Charles Schwab Corp (SCHW.N) and TD Ameritrade Holding Corp (AMTD.O), did not allow trading of the new futures immediately.
Bitcoin’s manic run-up this year has boosted volatility far in excess of other asset classes. The futures trading may help dampen some of the sharp moves, analysts said.
Sceptics argue that the CBOE futures will simply draw more naïve investors into perpetuating a bubble in a financial asset that Nobel economist Joseph Stiglitz has accused of having no intrinsic value beyond supporting money laundering and tax avoidance.
Bitcoin is not regulated by any country’s central bank and has no universally recognised exchange rate.