CME 800x400 - How CME Group Decision Can Influence Bitcoin Price

How CME Group Decision Can Influence Bitcoin Price

The CME Group, the world’s largest options and futures exchange will launch Bitcoin futures before the end of the year. Their statement was published on the CME Group official blog on 31 October 2017.

What are Bitcoin Futures?

The Chicago Mercantile Exchange decided to add Bitcoin futures before 2018. Futures are financial contracts that obligate a buyer or seller to purchase or sell an asset. Future exchanges are used, in general, to speculate with the price of different assets or hedge against an eventual price fluctuation.

“Giving increasing client interest in the evolving cryptocurrency markets, we have decided to introduce a bitcoin futures contract. As the world’s largest regulated FX marketplace, CME Group is the natural home for this new vehicle that will provide investors with transparency, price discovery and risk transfer capabilities,” said Terry Duffy, CME Group Chairman and Chief Executive Officer in a News release by CME Group.

On November the 2nd, Rofex, the biggest futures exchange in Argentina announced that it will add cryptocurrency services for its customers.

CME Group also wrote a report called “The Evolving Economics of Bitcoin, Gold and Fiat Currencies”  on their official blog. You can read it here.

How Can Bitcoin Futures Modify Bitcoin Price?

The Bitcoin market will be affected in different ways because of these decisions. First, more people will be able to know the cryptocurrency world. When important institutions like CME or Rofex work as a link between investors and the cryptocurrencies, it is easier for investors to get involved. In this way, new buyers can push the price up, even further. At the moment, Bitcoin has a penetration of 0,15%. What will happen when it will arrive to 15%? Its price will keep growing.

Second, the market will become more liquid. More buyers and sellers mean that the volume will grow too. This will provide a fast way of leaving the market in case an investor needs to take the money out. If another buying opportunity appears, you can sell faster a liquid asset and buy another cryptocurrency that is in a bullish market.

Third, as more investors enter into the market and the price keeps growing, Bitcoin and cryptocurrencies will gain knowledge among people. Media will cover more what is going on in this sphere. Financial institutions would start to invest on it and analyse it. Common individuals would also start to pay attention to it and invest some few dollars.


The situation seemed to impulse Bitcoin price to new highs. The information released by the company produced Bitcoin price to surge up to $7350 dollars in Thursday from $6500 some hours before. But the price did not stop there. It arrived at $7440 on November the 3rd. Individuals start to realize that big investors have a lot of money to push the virtual currency price up.

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“While Bitcoin investors cheered the rally, dubbing the CME’s decision a step toward legitimizing the cryptocurrency, it was also a reminder that digital coins still have a way to go before reaching widespread mainstream adoption,” Forutne reported.

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3 Replies to “How CME Group Decision Can Influence Bitcoin Price”

  1. Purdue Pete

    While I’m worried that the big banks will use futures to try and suppress the price of bitcoin (like they do with gold) I think it will be good in the long term price of bitcoin to see big players invest large amounts of capital in Bitcoin.

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