Bitcoin finally arrived on Wall Street with the launch of the Chicago Board Options Exchange’s (CBOE) futures for the cryptocurrency on Sunday. Within hours of the exchange kicking off trading for Bitcoin futures at 6PM ET, they soared by 25 percent – triggering a five-minute trading halt that’s similar to a pause in trading stocks when prices rise or fall drastically.
The launch also caused CBOE’s site to crash, due to a massive surge in traffic. Things soon returned to normal, and trading of the new futures, which use the XBT ticker symbol, continued.
Due to heavy traffic on our website, visitors to https://t.co/jb3O722hoo may find that it is performing slower than usual and may at times be temporarily unavailable. All trading systems are operating normally.
— Cboe (@CBOE) December 10, 2017
CNBC reports that the new futures contract, which expires on January 17, 2018, traded more than $2,000 higher at $18,490 (an increase of nearly 20 percent).
For those out of the loop, here’s what you need to know, from this handy explainer over on Business Insider: a future allows two parties to exchange an asset at a specified price at agreed-upon date in the future. In the case of Bitcoin futures, it’s essentially a financial product that lets investors bet on what they think the price of Bitcoin will be at a future date.
The launch of Bitcoin futures on CBOE means that large investment firms and brokers can bet big on the cryptocurrency, lending it more credibility and possibly curbing its volatility. There’s also a chance of it being turned into an exchange-traded fund, where the fund owns the underlying assets (Bitcoin, in this example) and divides up its ownership into shares. Investors will then receive interest or dividends as it’s continually traded.
Of course, some folks are still not convinced that Bitcoin is ready for use with such financial instruments, but the incredible growth in value of the cryptocurrency – 1,600 percent this year alone – means that it’s impossible to ignore the possibilities and opportunities that it could afford.