Bitcoin's rapid rise from less than US$800 in December a year ago to more than US$11,000 this week on Coindesk has stoked fears that it is a pricing bubble that could leave recent investors worse-off.
CBOE Global Markets Inc. said Monday that it will launch trading of bitcoin futures on Sunday, Dec. 10.
The first USA bitcoin futures will start trading next week, as dueling Chicago futures exchanges seek to cash in on surging investor interest in the digital currency. "To promote this, we will initially offer XBT futures trading for free." said Ed Tilly, Chairman and Chief Executive Officer of Cboe Global Markets.
The fact that this price was achieved much before the end of the year and that the prices overshot this region to move beyond the $11,000 region during the month was a sample of how strong this bull run has been during the month of November.
Bitcoin futures and other derivatives would make it easier for more investors and speculators to trade the new asset class.
The cryptocurrency was last up 0.4 percent at $11,290. Bitcoin itself is now bought and sold on platforms that are virtually unregulated, which has made some money managers uncomfortable with the market even as prices soar.
However, despite the cash-settlement process, some institutional investors have expressed concern at the addition of bitcoin-derived products to CME.
Bitcoin futures would allow traders to bet on rises and falls in the digital currency, similar to the way oil, corn or gold futures work.
The Commodity Futures Trading Commission said it had discussions with the exchanges to protect consumers from extreme price swings.
CME Group's Bitcoin futures will be cash-settled, based on the CME CF Bitcoin Reference Rate (BRR) which serves as a once-a-day reference rate of the USA dollar price of bitcoin.