How could futures impact bitcoin? - page 5.

pinkflower

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Quote from: pitiflin on December 14, 2017, 02:46:40 PM

Quote from: braveheart on December 14, 2017, 02:38:19 PM

I don't fully understand the Futures market.
How could futures impact bitcoin and its price?

This derivatives is only to be paid in cash and it'll affect the price is institutional buyers would love to influence the price on their own, and this could be a big deal later on.

Wrong. To influence the price of BTC, the institutional traders, not just buyers because they also sell, would have to buy real BTC. This is counterproductive if they also trade BTC futures. The futures market is maybe only good as a hedge to lessen risk for institutional investors who already hold BTC.

xbl1008

full member

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future is a financial institution that offers margin trades to its users, it has a lot of users so we can see a huge trades of bitcoins here it may cause more volatility in the bitcoin price as of now and it may also make hasten the increase of its price.. but with the high risk of margin some may lose its bitcoins while some might win very big in this matter.

pixie85

hero member

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So in other words you're asking someone to buy coins for you and that person handles all the risk and technicalities like managing wallets, trading on exchanges, verifying accounts, security of holdings and so on. You get an IOU from them and if they lose the coins, get hacked, whatever, they still have an insurance and owe you money as a registered business. Am I correct? This means futures are a way for technical newbies or people who are afraid to take the responsibility for their own coins to still be able to invest.

indiangrad

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Quote from: IT_AEX on December 14, 2017, 09:37:04 PM

Quote from: HasHe on December 14, 2017, 07:43:25 PM

Quote from: braveheart on December 14, 2017, 02:38:19 PM

I don't fully understand the Futures market.
How could futures impact bitcoin and its price?

It would not affect bitcoin price directly.It would just remain as oil futures,gold futures do remain without having any direct impact on such commodities.It would just boost bitcoin price to a small extent.

So CBOE and future market companies, do not hold bitcoins on their own?

Not as part of their business

IT_AEX

newbie

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Quote from: HasHe on December 14, 2017, 07:43:25 PM

Quote from: braveheart on December 14, 2017, 02:38:19 PM

I don't fully understand the Futures market.
How could futures impact bitcoin and its price?

It would not affect bitcoin price directly.It would just remain as oil futures,gold futures do remain without having any direct impact on such commodities.It would just boost bitcoin price to a small extent.

So CBOE and future market companies, do not hold bitcoins on their own?

HasHe

hero member

Activity: 952

Merit: 500

Quote from: braveheart on December 14, 2017, 02:38:19 PM

I don't fully understand the Futures market.
How could futures impact bitcoin and its price?

It would not affect bitcoin price directly.It would just remain as oil futures,gold futures do remain without having any direct impact on such commodities.It would just boost bitcoin price to a small extent.Both bitcoin and bitcoin futures would travel parallel and bitcoin futures would be valued based on the current price of bitcoin in gemini exchange.Bitcoin futures increase in price would serve as a cause for increase in bitcoin price.

braveheart

newbie

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Quote from: pitiflin on December 14, 2017, 02:46:40 PM

Quote from: braveheart on December 14, 2017, 02:38:19 PM

I don't fully understand the Futures market.
How could futures impact bitcoin and its price?

Here's the deal with these futures. You don't actually hold any bitcoin on your own, but you do own some sort of financial instrument given by the CBOE, and it states that they hold bitcoin on the investor's behalf not precisely but somewhat like that. This derivatives is only to be paid in cash and it'll affect the price is institutional buyers would love to influence the price on their own, and this could be a big deal later on.

Thanks for your response.
So, I'm guessing the CBOE would have been loading up with Bitcoin prior to 10th Dec. The demand driving prices up?

pitiflin

hero member

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Quote from: braveheart on December 14, 2017, 02:38:19 PM

I don't fully understand the Futures market.
How could futures impact bitcoin and its price?

Here's the deal with these futures. You don't actually hold any bitcoin on your own, but you do own some sort of financial instrument given by the CBOE, and it states that they hold bitcoin on the investor's behalf not precisely but somewhat like that. This derivatives is only to be paid in cash and it'll affect the price is institutional buyers would love to influence the price on their own, and this could be a big deal later on.

braveheart

newbie

Activity: 30

Merit: 0

I don't fully understand the Futures market.
How could futures impact bitcoin and its price?

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