There is a theme being propagated on interwebs that bitcoin will never be able to get from under negative price pressure from CME/CBOE futures (which are cash-settled). Apparently, it happened multiple times before with other commodities.
Q to WO crowd: do you think that bitcoin does (or doesn't) have some futures fighting mitigation strategy?
Personally, i don't fully buy that doom-and-gloom scenario because other cryptos did not have futures, yet declined even more, hence not a clear cut picture.
Would btc-settled futures like bakkt and/or 'physical' ETF objectively helpful in this fight or not?
Of course, if some some major fiat currency would experience hyperinflation, then btc would benefit, but this scenario is not very conducive to day-to-day life.
I would prefer to think about how we can use intrinsic bitcoin properties to fight CME/CBOE pushing us down (in price).
Seems to me that you have to buy BTC in order to sell them, so can be a question regarding how long these folks can continue to get BTC to sell to send the price down, even if settled in dollars , aren't the shorts going to get reckt as some point if people are not willing to sell their BTC and there is not enough BTC to fuel the various contracts that are settled in dollars?
Nope, you don't need to do anything with the underlying (bitcoin) in order to buy/sell futures, which settle in cash (not bitcoin).
Same occurs on the stock market where since 1987 PPT regularly buys S&P500 futures (during crashes) to bring the underlying S&P up.
They save the money this way, lol. It's $-efficient.
I guess that I don't understand then.
I don't see how you can get the price to go down without selling and no one willing to buy at that price, so the price goes lower and lower, until someone is willing to buy BTC at that price.
Doesn't matter if you are settling in dollars, you still have to sell BTC to get the BTC price do go down and have no buyers. If you have no BTC, then you cannot sell them. Of course, we get into factional BTC, and I understand some of that fractional BTC can occur, up to a point that some buyers, when the buy, are going to want to have the real BTC, rather than a paper claim. It is easier to claim your BTC than it is with a large number of other assets, including stocks and gold.
Hate when they do that, it always goes the opposite direction. Except when they put the big sells in then everyone dumps. DOH
edit: old