ASDAQ Inc. is charging into the chase to take bitcoin to a greater swath of investors, as the digital currency’s value barrelled beyond $11,000 on 29th Nov 2017.
Next year, the New York-based exchange operator strategises to launch bitcoin futures. According to a person familiar with the subject, it is becoming the third major U.S. exchange to jump into the red-hot marketplace of crypto-currencies. Near the beginning of second quarter NASDAQ will launch the products and the contracts will trade on its NFX marketplace.
The strategy is just an indication of a huge exchange operator compelling bitcoin further into the mainstream investing world. This proposal is going to pit NASDAQ against two stronger rivals, CME Group Inc. and Cboe Global Markets Inc., each of them already announced plans to supply cryptocurrency derivatives. NASDAQ is a relatively small player in the futures market, which might make it harder to grow an image as a destination for crypto-currency derivatives trading.
Rich Repetto, an analyst at Sandler O’Neill & Partners LP explained: “They are a small futures market, so they may observe the competence to enter a Product that might be much larger someday.”
Awake Against Bigger Players
The Strategy also suggests that New York Stock Exchange proprietor Intercontinental Exchange Inc. is the only one of the four leading U.S. exchange operators with no Public plans to supply bitcoin derivatives.
One way NASDAQ attempts to distinguish itself seems to be in the amount of information it uses for pricing the digital currency contracts. A person stated that Recently Vaneck Associates Corp. withdrew his plans to get a bitcoin exchange-traded finance, will provide the data used to price the contracts, pulling figures from over 50 sources. That appears to go beyond CME’s strategy to use four sources. NASDAQ contracts will soon be removed by Options Clearing Corp.,
Handling Hard Forks
The NASDAQ contracts can also be designed to take care of bitcoin hard forks more elegantly, the person said. Hard fork occurs when miners agree to modify in the system that underpins the cryptocurrency, developing a new edition. NASDAQ products will reinvest profits from the spin-off straight into the former bitcoin in a way intended to make the process smoother for dealers.
Bitcoin currently deals in virtually unregulated markets. NASDAQ, CME, and Cboe are heavily controlled, bringing a sense of authority which should assist professional traders to feel more comfortable engaging. In 2017 Bitcoin’s value has increased in value by more than 11 times.