[2017-12-06] NYSE Owner: We Aren’t Rushing Toward Bitcoin, Yet

[moriskarlov]

The owner of the world’s largest stock exchange does not believe it is wise to race to be the first U.S. exchange to list bitcoin futures contracts.

Over the past several months, exchange operators have been rushing to bring the first regulated bitcoin futures contracts to market. Chicago-based CME Group appeared to have the early edge, and last week it announced it had received approval from the Commodity Futures Trading Commission (CFTC) to list bitcoin futures on December 18.

However, fellow Chicago exchange Cboe stole CME’s thunder, because on Monday it announced it had filed a product certification with the CFTC to begin bitcoin futures trading this Sunday. Nasdaq, the world’s second-largest stock exchange, is also reportedly planning to launch bitcoin contracts on its futures exchange during the first or second quarter of 2018.

The rush to launch bitcoin-derived products signals that cryptocurrency is well on its way to permeating the mainstream financial industry, but at least one exchange operator is hesitant to list products for this emerging asset class.

“We may be stupid for not being first on that, Intercontinental Exchange Inc. (ICE) Chairman and CEO Jeffrey Sprecher told a financial conference in New York earlier this week, according to a Reuters report.

ICE owns and operates dozens of exchanges, most notably the New York Stock Exchange (NYSE), whose market cap is three times as large as that of the Nasdaq.

But although Sprecher said ICE may be “stupid” for taking a wait-and-see approach to bitcoin futures, he said that it was too risky to be the first to bring such an untested product to market.

“We didn’t think it was obvious to rush out a product and be first and settle against an index on a lot of exchanges that are not particularly transparent,”  Sprecher said, adding that he feared that bitcoin sellers would use the futures as an opportunity to manipulate the market and exit large positions, a scenario that would reflect poorly on exchanges that list bitcoin futures.

“To short that would mean that they have decided to exit and through a legitimate, high-standing, regulated venue, they are exiting, and I look at that and just say, is that going to work out well for me as a venue?”

Despite these concerns, many people believe that the launch of bitcoin futures will lend bitcoin legitimacy in the eyes of both institutional and retail investors, leading to the creation of the first Bitcoin ETF, as well as other bitcoin investment products wrapped in familiar packages.

https://www.cryptocoinsnews.com/nyse-owner-arent-rushing-toward-bitcoin-yet/

[richardsNY]

It's an understandable decision. If we look at various aspects of markets not related to crypto currencies, there has been an explosion of services and businesses rushing to take their cut of the Bitcoin market now it's booming, but they severely lack actual knowledge and foundation to build something useful. For that reason I strongly believe that after a year or two, the majority of these services will either fail, or withdraw themselves from this market. I rather see a slower adoption that's more sustainable in the long term, than seeing whatever entities be part of market to ride the 'hype' and then vanish.

[aso118]

It is a tough call to take. Do you want to lose the first mover advantage to exchanges like CME and CBOE, or do you want to take a risk and take the plunge by offering bitcoin future? Even Nasdaq is getting into the game.
I think if you play safe in an evolving technology, you get left behind.

[darkangel11]

They will wait and watch the first endeavours struggle. There's no need to take a risk and it's not like they'd need money or fame. People are still using them and will continue to regardless of whether they add BTC futures or not. The whole world will be watching BTC now to see if it pops in the next 1-2 months or not. If not we can be sure more money will come rushing in.

[BitHodler]

It is a tough call to take. Do you want to lose the first mover advantage to exchanges like CME and CBOE, or do you want to take a risk and take the plunge by offering bitcoin future? Even Nasdaq is getting into the game.
I think if you play safe in an evolving technology, you get left behind.

You definitely have a point, but these level market players mostly tend to be very conservative with their actions, and definitely so when it comes to something that's insanely volatile and not yet properly regulated.

They plan to see how their competitors will be doing initially, and from there research everything properly. If they end up making rookie mistakes, NYSE at least knows what to do and not to do.

It's a safe bet for sure, but it's not that NYSE needs Bitcoin for whatever reason. I totally get it that they want to look at how their competitors will be doing first. They'll join when they feel comfortable and think it's rewarding enough.

[Rahar02]

Indeed, they are the biggest stock exchange in the US which has a market cap 3 times bigger than Nasdaq.
So, they have to watch closely to CME group and Nasdaq about how they will handle the bitcoin futures contract, whether it will be worth to be listed or something will going wrong as Jeffrey Sprecher said;
Sprecher said, adding that he feared that bitcoin sellers would use the futures as an opportunity to manipulate the market and exit large positions, a scenario that would reflect poorly on exchanges that list bitcoin futures.

Especially at current market situation and bitcoin volatility that can increase $1000-$2000 in a day or vice versa.

[pixie85]

Indeed, they are the biggest stock exchange in the US which has a market cap 3 times bigger than Nasdaq.
So, they have to watch closely to CME group and Nasdaq about how they will handle the bitcoin futures contract, whether it will be worth to be listed or something will going wrong as Jeffrey Sprecher said;
Sprecher said, adding that he feared that bitcoin sellers would use the futures as an opportunity to manipulate the market and exit large positions, a scenario that would reflect poorly on exchanges that list bitcoin futures.

Especially at current market situation and bitcoin volatility that can increase $1000-$2000 in a day or vice versa.

It can't be helped. We either have to allow the market to regulate itself or make the government do it for us. Bitcoin was made with the former in mind so let's sit tight and wait. Large holders exiting won't change much in the long run. Don't tell me this hasn't happened before on regular exchanges and yet we're still here with Bitcoin being worth more than ever.