Killer Whale Crypto
July 17, 2021, 11:02 AM UTC
This article highlights Bank of America's bitcoin futures trading
Bank of America is Gearing Up for Bitcoin Futures Trading
As of Friday, July 16th, America’s second-largest bank – Bank of America – will reportedly now be offering bitcoin futures contracts. The news came early Friday morning when Bank of America’s head of global research -- Candace Browning -- informed the public that bitcoin futures trading is in the process of being set up for select Bank of America clients. As this is still developing news, there is not much information regarding the specifics of this new venture, which Bank of America is undertaking. That being said, Bank of America’s move into bitcoin futures trading has sparked quite a bit of hype and conversation within the crypto community, within a short amount of time.
One of the most interesting points of discussion, is that this product is hitting the market at a time when bitcoin has cooled off by approximately 50 percent from its previous all-time high. By contrast, the Coinbase IPO took place on the same day as bitcoin’s near 64 thousand dollar all-time high. All-time highs are typically a more common point in the market to see products similar to this being unveiled. As an example, the Chicago Mercantile Exchange (CME) bitcoin futures was also released at bitcoin’s 2017 all-time high; one which reached slightly south of 20 thousand dollars. Of course, large institutions – such as Bank of America – do not pull the trigger on product releases like bitcoin futures trading on a whim. It is likely that this project has been in the works for some time and was set in motion by the hype surrounding cryptocurrency, at the top of bitcoin's most recent buying climax.
Another interesting point to consider is that crypto futures trading is nothing new to the world of cryptocurrency. Bitcoin futures are already available on a wide range of established cryptocurrency platforms. The major difference Between Bank of America’s bitcoin futures trading, and the cryptocurrency futures trading that already exists, is the fact that Bank of America is catering to the high-volume traders, who typically only participate in the traditional stock market.
Historically, new bitcoin futures options tend to have a negative impact on the price of bitcoin. One of the largest concerns regarding Bank of America’s bitcoin futures trading is that the current bitcoin market could be substantially impacted by high volume traders placing short positions. Currently, bitcoin is vulnerable to both bullish and bearish price action, as it essentially continues to move sideways. At least for the time being.
All speculation aside, bitcoin futures trading through Bank of America is yet another steppingstone on a path – which leads towards cryptocurrency as a whole – becoming a more integrated, and commonplace component of the global economy. Even though the price action of bitcoin appears to currently be in a dormant state, we have borne witness to the growing adoption of bitcoin on a larger scale than ever! We now see bitcoin on the balance sheets of businesses, corporations -- and in the case of El Salvador -- even being adopted as legal tender!
All and all, it is evident that we will see an increasing amount of institutional adoption and participation between cryptocurrency and the traditional markets in the years to come!
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