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A comment on Some Wall Street banks won't offer access to the first Bitcoin futures market. Parent comment

Re:Some Wall Street banks won't offer access to the first Bi... by Ntrails on Friday December 08, 2017 @04:29AM (#15877633)
It's a pretty big brake from the point of view of institutional investors. If none of my brokers offer access I simply can't trade it - it stops volume going through the futures.

Futures volume will drive volume in the underlying if only as Sneaky Sneaky People attempt to arbitrage using the hilariously manipulable price of bitcoin

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Re:Some Wall Street banks won't offer access to the first Bi... by minhaz23 on Friday December 08, 2017 @07:22AM (#15878228)
Can you expand on that second paragraph?
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Re:Some Wall Street banks won't offer access to the first Bi... by totalZero on Friday December 08, 2017 @10:26AM (#15879266)
Futures trading allows better price discovery, and generally improves the market for the underlying by contributing liquidity, especially from speculators.

(This is true for most commodities, but I think it could potentially be false for BTC depending on the way hedging transactions are logged and computed.)

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Re:Some Wall Street banks won't offer access to the first Bi... by IncRnd on Friday December 08, 2017 @08:49AM (#15878569)
> Can you expand on that second paragraph?

Futures stabilize the price of the underlying commodity.

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Re:Some Wall Street banks won't offer access to the first Bi... by valarauca1 on Friday December 08, 2017 @10:56AM (#15879539)
The argument mostly boils down to that most rational actors will only tolerate a +/-N% change over the lifetime of a futures contracts

So the average future contract +/-N% (overall futures) roughly becomes the maximum volatility you can see out an asset over that duration. If it is exceeded people may stop trading futures, lowering the number of swaps, and by extensions trades of that asset. Providing a method to -let steam out- of a volatile system.

——

There are many examples against this (housing crisis 2008). The main example for is Chicago future exchange in the 70’s and 80’s http://www.econlib.org/library/Enc/FuturesandOptionsMarkets....

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Re:Some Wall Street banks won't offer access to the first Bi... by IncRnd on Saturday December 09, 2017 @12:43AM (#15884504)
From the very link you posted, "Because futures contracts offer assurance of future prices and availability of goods, they provide stability in an unstable business environment."
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Re:Some Wall Street banks won't offer access to the first Bi... by valarauca1 on Monday December 18, 2017 @07:41PM (#15956833)
I typo'd.

I was trying to show there was support for them providing stability, as for them failing to do this.

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