What to expect if future ether becomes reality?


Less than a year after the launch of the first Bitcoin futures contracts, Ethereum could be the second cryptocurrency to be traded on regulated futures.

It is understood that the Chicago Board Options Exchange (CBOE), the same platform that launched the Bitcoin futures in December 2017, is awaiting the green light from the Commodities Futures Trading Commission (CFTC) for the launch of the Ethereum options within the end of 2018.

The CBOE will base its ETH contracts on the Gemini cryptocurrency exchange market – the base it already uses for its Bitcoin futures.

With the US Securities and Exchange Commission (SEC) formally declaring that Ethereum was not classified as security in June, the path to follow was apparently open to the possible launch of ETH Futures.

At the time, CBOE president Chris Concannon hailed the decision, saying that the ETH contracts had been a point of discussion since the end of 2017:

"We are satisfied with the SEC The decision to provide clarity over the current Ether transactions. This announcement cancels a key obstacle to Ether futures, the case we've been considering since we launched the first Bitcoin futures in December 2017. "

Only three months later, there are very real rumblings that this could come to fruition, very similar to that of the final launch of the Bitcoin futures in 2017.

The CBOE has indicated to Cointelegraph that it is looking at Ethereum futures, emphasizing the Concannon interview with Quarts in June, where he exposed their thoughts on the cryptocurrency and the possibility of a futures contract:

"The ether is one of the most liquid cryptocurrencies out there, along with Bitcoin, the demand is much higher in Ether than any other cryptocurrency on the market. We will take a look at the future of short-term launch, but there is a process we must face before even announcing such a launch. That process is something we have talked about for a long time with the CFTC and we certainly want to take steps in this direction and make sure everyone is comfortable with the next product we are announcing. "

According to Concannon, there is a significant demand and appetite for Ether's futures. Having successfully launched Bitcoin futures, the CBOE hopes to use the same design and product structure and apply it to any future. of cryptocurrency that could be looked into in the future.

The CBOE will not reveal further details at this time, saying that the relevant information would be communicated in due course.

What could happen

While the finite details of when we can expect to see these Ether futures launched have yet to be revealed, the possibility of these new offers has had a neutral effect on different values ​​of cryptocurrency.

The price of Eth has turned from a slight recession on August 31st, that could be attributed to these initial reports.The price of Bitcoin showed a similar trend in the movement, with a sharp rise on the same day. [19659015] Crypto market 31.08.-01.09.2018. Source: coin360.io

In response to early reports on the CBOE plans, Fundstrat co-founder Tom Lee told Business Insider that Ether futures would have an initial negative impact on the price of cryptocurrency: [19659006] "Since December of this year, if one was bearish on any aspect of the crypt, but did not want to own the underlying, it could close the BTC Now they can short Ethereum, [which] means the BTC net on futures will fall. "

Good or bad?

It is not easy to predict what any market will do, and this is particularly true for cryptocurrencies. However, big moves like this from major financial institutions seem to influence the price of cryptocurrencies.

Cointelegraph spoke to senior market analyst eToro Mati Greenspan for an insight into how Ether's future could potentially influence the price of cryptocurrency.

Greenspan was optimistic about the possibility, saying that Wall Street is working hard to build bridges for the encrypted market, defining the launch of Ether's futures a critical step.

While some people on social media have cited concerns that the caesura would damage Ether's value, Greenspan offered a counter-argument at this point:

"The ability to move forward is a key component of price discovery. It is ultimately healthy for the market. "

In addition, Greenspan believes that a future contract on Ether will put the cryptocurrency in the spotlight, which could very well attract new investors with deep pockets. The eToro analyst also believes that it could have a knock-on effect on other cryptocurrencies:

"Cryptographic prices are closely related to one another, so all that is good for Ethereum it should be good for Bitcoin and vice versa.Boost, Bitcoin futures volumes have been relatively small and insignificant compared to the rest of the market, but since the interest of institutional investors changes, we should see higher volumes and new ways to trade them. "

While Greenspan offers a far more optimistic prediction of what is to come, there are those who have a more cautious view of the potential launch of Ether's futures.

Phillip Nunn, CEO of Wealth Chain Capital, told Cointelegraph that there is potential for some short Ether investors, which could have serious consequences for companies that launched ICO on the Ethereum blockchain.

Nunn compares the launch of BTC futures to foreign exchange markets some 30 years ago, where futures markets had a major influence on the markets:

"2018 saw a huge change in the crypto's behavior mainly due to The advent of the Bitcoin futures, the rankings have been different and clearly there has been a manipulation of the market and "whales" that dominated the mketket in both cases.Someone is making a lot of money. currency markets of the years 80 and 90 in which it was easy to influence the markets through long and short. "

In addition, the Nunn sites represent the future of risk for companies that have raised money using ERC20 tokens:

"I worry about ETH on a couple of levels." First, the market capitalization is much smaller than Bitcoin and I think ETH futures could see it fall by $ 150, maybe even $ 100. Add to this c he 95% of ICO collects money with ERC20 tokens in ETH, if an ICO has raised $ 20 million dollars and holds ETH, suddenly in half and I think it will trigger sales of these companies to BTC or FIAT to protect their interests. "

A different result?

While the crypto futures was launched by Bitcoin, it may be difficult to draw early conclusions from the launch of BTC futures in December 2017.

Shortly thereafter the CBOE and the Chicago Mercantile Exchange ( CME) launched their respective future offers, Bitcoin reached its all-time high of just over $ 20,000, before a humiliating correction left the markets in red and wavered for months.

role in significant pull-backs in the markets of cryptocurrency, made life difficult when it came to judging how BTC futures influenced markets and influenced prices.

In July, CME stated that it would not launch any other cryptocurrency futures res offer. , released data showing that the average daily volume of BTC futures had increased by 93% compared to the first quarter of 2018.

Considering the growth in the number of BTC futures contracts in mid-2018, it may be fair to assume that it is a growing appetite for this type of financial offerings in the cryptocurrency space.

However, the possible launch of Ether's futures will be a space that will be carefully monitored in the coming months. As summarized by Nunn in his comments to Cointelegraph, the prediction of prices in the encrypted space was as good as a shot in the dark:

"Obviously I could be wrong and could fly to $ 1000 but it seems that futures strategies are needed To stifle the true growth of cryptography, this was certainly the case with Bitcoin since all price forecasts are out of the window. "

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