The world of bitcoin – and by extension, the world of cryptocurrency – has been given a lift by the US Securities and Exchange Commission (SEC) recently giving its seal of approval to allow a new bitcoin futures contract exchange-traded fund (ETF) to start trading.
But what are bitcoin futures contracts, and how will this affect the price of bitcoin? Let us explain.
Bitcoin futures contracts explained
A futures contract is an agreement to carry out a transaction at some point in the future at a price that is agreed today.
In other words, if the value of something goes up before the sale is completed, then the person buying the item – whether it a fiat currency, stocks, commodities or, in this case, a cryptocurrency – gets a good deal. If the price goes down, however, then the person selling the item gets the better end of the bargain.
https://currency.com/bitcoin-futures
BTC futures contracts can trade with 100x leverage in addition to the other benefits mentioned. Making them a boon for savvy traders and a massive liability for everyone else.
The way you describe "bitcoin bonds" is closer to put and call options trading than treasury bond markets, if I remember correctly.
I think crypto futures ETFs are legal in the united states. Wheras spot based crypto ETFs are not.