Bitcoin surges as world's biggest exchange announces futures

Jon Howard
November 1, 2017

The BRR aggregates the trade flow of major bitcoin spot exchanges during a specific calculation window into a once-a-day reference rate of the US dollar price of bitcoin.

Terry Duffy, CME Group chairman and CEO, said: "Given increasing client interest in the evolving cryptocurrency markets, we have made a decision to introduce a bitcoin futures contract".

The cryptocurrency marked a high at 6,416.39 after the CME said it will start offering trading the derivatives in the fourth quarter.

The cryptocurrency jumped almost 5 percent to as high as $6,420 after the announcement.

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The creation of bitcoin futures by the CME Group could finally make it possible to establish an exchange-traded fund that's based on the world's most popular cryptocurrency, which has been previously hard due to bitcoin's largely unregulated nature. The reference rate is a daily settlement price published at 4 p.m. London time, now noon ET. Bitcoin futures will be listed on and subject to the rules of CME.

Today, there are several other exchanges like GDAX, itBit, Bitstamp and Kraken that contribute towards calculating the Bitcoin Reference Rate.

Bitcoin is a form of digital currency, created and held electronically. In addition to the CME, the CBOE previously unveiled plans to launch bitcoin futures contracts on a similar time table. The announcement is a boon for upcoming ICOs as it thrusts cryptocurrencies further into the spotlight on a global platform that is regulated by the Commodities Futures Trading Commission (CFTC).

Some sellers of exchange-traded funds have also filed for bitcoin ETFs that track bitcoin futures.

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