Late last night, the futures market debut of Bitcoin went off with a bang with the cryptocurrency surging over 20 percent and crashing the website of the exchange.
The Cboe Global Markets of Chicago’s website went down twice because of heavy traffic as the price of the January bitcoin contract increased from an opening price of about $15,000 to as high as $18,850 in unpredictable trading.
Over 2,600 contracts had shifted hands at the time of writing.
The chief market strategist at FXTM, Hussein Sayed, said that the initial reaction surpassed expectations.
Sayed stated: “So far, it seems professional investors aren’t willing to bet against bitcoin, despite the many warnings of a bubble that will burst soon. Many traders aren’t even interested in the price direction, but the listing of the futures contract on Cboe and later next week on the CME, will provide them an arbitrage trading opportunity due to the vast pricing differences.
“However, the arbitrage trading will lead to improved price efficiency and probably less volatility. After volatility settles down, the focus will return to the price direction.”
The head of equity strategy at Interactive Investor, Lee Wild, stated: “Anything that adds to the asset’s accessibility and legitimacy and reduces security risk often associated with cryptos will improve its credentials as a tradeable asset and so grow the pool of potential investors.
“Opportunities to profit from such extreme market conditions, akin to the dotcom boom, are rare indeed, but inevitably come loaded with risk. However, the music may have much longer to play on this one than people think.”
The Bitcoin futures contracts will start trading on CME on the 18th of December.
Meanwhile, this morning, the cash price of bitcoin on the aggregate index of Coindesk was up by almost 10 percent at $16,505.59 after a drop over the weekend.