It won’t be long before Bitcoin joins the likes of gold, oil, palm oil and other derivatives; if plans by CME Group to make Bitcoin Futures available by the end of 2017 are realized.
CME Group background
CME Group is listed on NASDAQ’s stock market as the world's leading and most diverse derivatives marketplace, handling 3 billion contracts worth approximately $1 quadrillion annually (on average). The company provides a marketplace for buyers and sellers, bringing together individuals, companies, and institutions that need to manage risk or that want to profit by accepting risk.
Understanding the different currencies available
An inherent tension exists between the two major purposes of money. One the one hand, we have currencies that are perceived as great stores of value, such as gold and bitcoin. They make for poor mediums of exchange.
By contrast, currencies that are effective mediums of exchange; such as fiat currencies used the world over, can make for dubious stores of value. Where a currency falls on the store of value versus medium of exchange spectrum influences its usefulness as a unit of account and a standard of deferred payment.
Same league as oil and gold
At the moment the fact is that Bitcoin is on the same level as oil and gold which has been trading for the longest time. Judging by the market’s response this year alone, Bitcoin price shot upwards of $6,400 against the USD in October.
This was from a low of $4,300 on October 1st, representing almost 50% increase in just one month. The price is expected to shoot up even higher by the end of this year.
A double-edged sword
Previously, Bitcoin had a reputation for being used for illegal means - money laundering, tax evasion and avoidance of regulated cross-border money flows. Even criminal organizations have been known to use Bitcoin due to its anonymity on who is behind the transactions.
It is extremely hard to trace, yet offers considerable security against physical fiat money.
Worldwide acceptance is good for Bitcoin
With Bitcoin Futures set to be launched, subject to regulatory reviews; it could open the floodgates. Who knows what else is in store for us with regards to cryptocurrency?
Category: Team WhaTechCompany profile: Tech junkie by profession and passionate about anything from the digital world, movies, games and reading. He loves writing and hopes you enjoy his writing as much as he does. Eza, is also known as Don in the virtual world, but don’t him me wrong, he's not a mafia type he's really a nice chap and a devout family guy.
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