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Bitcoin The Almighty Buck

Nasdaq Plans To Offer Bitcoin Futures In Early 2018 (engadget.com) 100

An anonymous reader quotes a report from Engadget: Nasdaq is planning to launch contracts for bitcoin futures in the first half of 2018, according to The Wall Street Journal, which will enable investors to predict and put money on the future price of the currency. The Wall Street Journal also reports that broker Cantor Fitzgerald will be launching bitcoin derivatives on its own exchange in the first half of next year as well, making for yet another brokerage to help make bitcoin a more mainstream financial instrument. The relative youth and volatility of the currency still keeps many investors away, of course, but bitcoin is probably here to stay, even if this is just a bubble. New uses for regular folks to spend with the currency continue to rise, like the UK Visa card based on bitcoin and Square's testing of the currency in its payment app.
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Nasdaq Plans To Offer Bitcoin Futures In Early 2018

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  • It seems like everyone is buying into the Bitcoin hype these days.

    Even non-techies are asking me why I didn't tell them to invest in bitcoin 5 years ago. I shrug and say I didn't receive payment in them for services rendered, nor have a high end graphics card and free electricity to mine, didn't want to end up on an ASIO watchlist and probably would have had my wallet hacked or coins stolen from an exchange.

    • It seems like everyone is buying into the Bitcoin hype these days.

      Even non-techies are asking me why I didn't tell them to invest in bitcoin 5 years ago. I shrug and say I didn't receive payment in them for services rendered, nor have a high end graphics card and free electricity to mine, didn't want to end up on an ASIO watchlist and probably would have had my wallet hacked or coins stolen from an exchange.

      As I've postulated on another thread... the odds of bitcoin taking off like this were pretty unlikely. It's not the first digital currency, probably not even the best designed digital currency (although, you have to agree it's proven itself workable). The odds of Bitcoin taking off like it has would have looked (and did look) pretty remote to most people. Without the black market in the early years, it probably wouldn't have survived.

      In hindsight, Bitcoin would have been a really smart investment (if you

      • with magic hindsight glasses the best investment would have been to buy a few thousand coins back when they were effectively worthless, print them to a cold wallet, and store said wallet in a safe deposit box. Of course the same hindsight would be to buy the winning lotto tickets for a big jackpot.

        I did not do this. :)

        • with magic hindsight glasses the best investment would have been to buy a few thousand coins back when they were effectively worthless

          Even if you had made the fortunate decision to buy them for pennies, what's the chance you would have sold them for $5 or $10 or even $100 ?

          • considering I liquidated about 18 months ago? high :) but since we're talking about magic glasses I would have a programmed sell limit order set for yesterday's peak.

      • You've taken personal bias to a whole new level. Not only are you taking credit for past predictions that ultimately panned out, you're taking credit for past invalid predictions. Perhaps the people who bought years ago know something you don't? Nah, that would be too damaging to the ego...

    • It seems like everyone is buying into the Bitcoin hype these days.

      I can't find it to link it, but a couple of days ago, I was reading an article (on BBC?) that was saying that more than half of the new money flowing into bitcoin was from Europe. The US was only spending about one third as much as Europe on bitcoin recently.

  • Futures are used to manipulate the prices of commodities....
    By not having to actually own the underlying commodity, the 'futures' contracts bought and sold create a artificial system which allows control over a resource. Unless the futures sellers are required to actually OWN the bitcoins they are selling 'in the future'...which gets real fuzzy, real fast.

    • Futures are not a way to "manipulate" the price. Futures are basically a gamble. Participant A agrees to sell the commodity to participant B at the current price, but the actual exchange of the commodity will happen in the future at time X.

      If the price at time X has dropped, A can buy the commodity for cheap and sell it to B at the agreed (former) price and make a profit. If the price at time X has risen, A has to buy the commodity for the more expensive price to sell it to B at a loss, and B wins.

      It's a wa

      • by religionofpeas ( 4511805 ) on Thursday November 30, 2017 @09:48AM (#55649821)

        The main purpose of future markets is to allow predictable prices in the future, or for hedging other risks. For instance, an airline can get a futures contract for jet fuel for the next summer, so they can already plan their budget without risking sudden price shocks. At the same time, a refinery can sell that jet fuel for next summer with exactly the same benefits.

        Speculators that sit in the middle actually help grease the system by providing liquidity. If jet fuel is cheap now, but the future price is high, it becomes profitable to buy some right now, fill up a storage tank, and sell a contract for the summer. Because of these middle men, sharp shocks in the price of the commodity are smoothed.

        • Still seems like gambling to me. :( I struggle with these concepts, but your description did help.
      • by Baron_Yam ( 643147 ) on Thursday November 30, 2017 @09:55AM (#55649855)

        Futures make sense (to me) when you're dealing with something that takes time to mature and requires significant capital up front.

        Most of what I see is raw gambling, though.

  • by Topwiz ( 1470979 ) on Thursday November 30, 2017 @09:34AM (#55649743)

    So Bitcoin mining involves running a special computer whose sole purpose is to waste electricity. If you have a solar panel I suppose that isn't an issue but if you live where coal is used, you are adding to pollution/global warming.

    • by Baron_Yam ( 643147 ) on Thursday November 30, 2017 @09:37AM (#55649755)

      >So Bitcoin mining involves running a special computer whose sole purpose is to waste electricity.

      Ridiculous amounts of it, though slightly less per unit of economic value now that Bitcoin's exchange value is so high.

      Of course, Bitcoin has a fix for that... the increase in price has made mining more economically viable, so more people will get involved with more ASIC farms, and Bitcoin will respond with an increase in difficulty. The level of waste will be maintained.

      • The kicker is that, through all of this screwing around... the energy production, the bitcoin mining, the trading ... absolutely nothing of any value is produced through the use of all that effort and resources, other than a spectacular demonstration of the way that entropy always increases.
        • Compare that to gold. It is mined. It requires energy and manpower. And then it is stored in a vault forever and traded on Wall Street.
          Fortunately, gold also has some use (electronics, jewelry). But what is the value of the gold that remained in a vault for 100 years?

          At least Bitcoin by itself doesn't steal some precious non-renewable metal from more productive use.

          • The perceived value of gold seems to be maintained (if not improved) across global events such as war, financial crashes etc. I wonder if Bitcoin's value would also be maintained in similar circumstances.
            • Depends.

              How many bitcoin can you smuggle inside your stomach into a concentration camp, then exchange them behind the camp's toilets for the lives of your children?

              • Good one.

                How many gold coins can you memorize in your head while you cross the border ?

                • It's not how many can YOU memorize.
                  It's how many is the guy with a 1970's Chinese-made AK who's guarding that particular border pass in the middle of nowhere willing to accept as a matter of faith.
                  I'm gonna go with... somewhere less than its value in lead and brass.

                  • With bitcoin, you can memorize a passphrase that will allow you to recreate your full wallet on the other side of the border.

                    Each type of coin has its own strengths...

    • You didn't think the US government printed (and re-printed) their dollars with printers powered by solar panels and recycled paper, did you?

    • No, the purpose is to secure a global payment network.
    • Cause Bitcoins also waste HUGE AMOUNTS of electricity with every single transaction.

      Currently it's at 271 KWh or about 9.15 "U.S. households powered for 1 day". [digiconomist.net]
      PER transaction.

      So... every three transactions, one would waste as much electricity as one would need to run a home for a month.
      It's like having to set the store on fire every time you get a loaf of bread.

      Basically... using Bitcoins is the moral equivalent of dealing meth to kindergartners. Or maybe heroin.
      Mining Bitcoin is the moral equivalent of pr

    • If you have a solar panel I suppose that isn't an issue but if you live where coal is used, you are adding to pollution/global warming.

      No matter how you get it, those are resources that could be going elsewhere. The computing resources and the power.

      • by Topwiz ( 1470979 )

        It would be better if the calculations were of something useful. It would be like a massively distributed computer.

    • The current world-reserve currency is the USD. This explicitly enables the USG to be the largest polluter in the world (nobody contests that).

      Are you concerned with pollution or energy consumption? Those are only loosely related.

      • by inking ( 2869053 )
        Lol, what? I mean, sure, you can wiggle around the definition of "pollution" until it fits your narrative, but China is producing almost twice the amount of CO2 that U.S. does. Regardless, both China and the U.S. produce CO2 making things that are actually useful as opposed to calculating nonsense for the sole sake of having a very secure and very slow ledger.
  • When do you think bitcoin bubble will burst and why it is before Nasdaq bitcoin futures market open?

    • When do you think bitcoin bubble will burst and why it is before Nasdaq bitcoin futures market open?

      As John Maynard Keynes is quoted as saying, "The markets can remain irrational a lot longer than you and I can remain solvent."

      (* no evidence that he actually did say this, though. The earliest use is A. Gary Schilling [quoteinvestigator.com].

  • so wall-street will now let you bet on the price of bitcoin as well as buy derivatives but isnt yet offering the actual product itself?

    please tell me how this isnt gambling, heck, even the summary says that this might be a bubble. but hos does this make bitcoin more mainstream? there are not more people trading it, they are just betting on it and its performance.

    the volatility and transaction time of the block chain is what will keep it from being a payment currency, but tip of the had to square for trying.

    • Transaction time is actually a benefit of the futures-- lock in the price externally with your "insurance" futures.

      What could possibly go wrong...

    • so wall-street will now let you bet on the price of bitcoin as well as buy derivatives but isnt yet offering the actual product itself?

      please tell me how this isnt gambling, heck, even the summary says that this might be a bubble. but hos does this make bitcoin more mainstream? there are not more people trading it, they are just betting on it and its performance.

      the volatility and transaction time of the block chain is what will keep it from being a payment currency, but tip of the had to square for trying.

      Trading stocks IS gambling. Starting a new company IS gambling.

      It might pay off, it might flop; you never know.

      The difference between stock trading, and investing in "bitcoin" or starting a new company is; you're investing your money with some knowledge and forethought. It's not based on rolling a dice, or what card comes off the deck next- it's based upon reading society.

      • by lgw ( 121541 )

        Owning a business is a risk, but not all risk-taking is gambling. Driving to work is a life safety risk. Owning a house is a financial risk. Lots of stuff you need to do in life are risks, but not gambling.

  • I realize that bitcoin is traded like a stock or commodity, but with the complete lack of underlying substance, wouldn't predicting the future odds of the Jets winning the Superbowl be equally relevant to society? Maybe even moreso?

    • The substance is decentralized storage and transfer of wealth. Future contracts are a useful addition to that. Suppose I hire you to do a job, and I offer you to pay in bitcoin when the job is done. You don't mind getting paid in bitcoin, but you're planning to sell the bitcoin as soon as you get them, and you don't want to risk that the price drops between now and when you get paid.

      You can solve that by buying a futures contract for next month that will give you a guaranteed sale price.

      • by lgw ( 121541 )

        The substance is decentralized storage and transfer of wealth.

        No currency stores wealth. Wealth and currency are different things. Wealth has some value in itself - it generates income or some other value over time.

        There are many things you can exchange currency for: wealth is one of them (and not a very popular choice is seems).

        • A bar of gold doesn't generate any income or other value over time, but you can use it as a store of wealth. You can also store your wealth as a pack of $100 bills in a safe deposit box.

          • by lgw ( 121541 )

            Well, gold is a store of value. Admittedly, people use "wealth" in a broad sense, but the useful technical sense is "an asset that generates value over time" (which effectively constrains it to "ownership of the means of production" and "loans").

            • The dictionary defines it as "an abundance of valuable possessions or money", which is also the meaning I intended.

              • by lgw ( 121541 )

                You might find economic studies of currency interesting. I find it interesting that a currency does not have to be a store of value (you'll find that phrase "store of value" is usual). A currency, really, is just "the most easily exchanged commodity", which BTC fulfills nicely for some people and circumstances. Historically there were "marketplace currencies" that were only used to mediate barter during a market day, and had no value beyond that day.

                There are also formally-run "favor banks" at some retir

    • wouldn't predicting the future odds of the Jets winning the Superbowl be equally relevant to society? Maybe even moreso?

      I don't see how just sitting there and saying "zero" is relevant to society.

  • These guys have a serious gambling problem.

  • Like most of the other federal agencies, the Orange Asshole has managed to gut the SEC [businessinsider.com]. If we had a functioning SEC, this would be illegal.
  • Time to get out (Score:2, Insightful)

    by Xyrus ( 755017 )

    I've said it before, and I'll say it again. Get out now. This is pure bubble speculation. There is nothing holding BC up other than people's irrational behavior. If this isn't a sign that BC is in a bubble then nothing else is. The whole thing is going to come tumbling down hard and fast.

    • I've said it before, and I'll say it again. Get out now. This is pure bubble speculation. There is nothing holding BC up other than people's irrational behavior. If this isn't a sign that BC is in a bubble then nothing else is. The whole thing is going to come tumbling down hard and fast.

      Even if it is "bubble speculation", those who got in when it was $2 could have been advised to get out when it hit $100, or $200, or $500, or $1,000, or $5,000, or $10,000. If you've "said it before" a year ago, those people are now 5 times richer if they ignored your advice. Since we avoided the psychological $10,000 barrier (which did show a big drop afterwards), the next big psychological barrier is $20k. If I had BTC myself now, I wouldn't sell until it got close to $20k now.

      The truth is, we don't kn

      • by DogDude ( 805747 )
        "Get out" how, exactly? Who will pay $10,000 US for a bitcoin?
        • "Get out" how, exactly? Who will pay $10,000 US for a bitcoin?

          People are paying $10,000. They're actually paying $11,000 now. That's why it is exchanging at that value. People ARE paying that much.

        • Yesterday, a total of 1 million bitcoins were traded on exchanges for a total of $10 billion. Selling one bitcoin is easy. You can open an account on an exchange, deposit your bitcoin, and as soon as your account is credited, you can sell it the next second and get your $10000 (or whatever the price is at that moment)

    • by lgw ( 121541 )

      Soon, you'll be able to put your money where your mouth is.

  • by barakn ( 641218 ) on Thursday November 30, 2017 @12:20PM (#55650799)

    ...but this is the exception. The instant that people can bet money that bitcoin will decline, they will. And when a massive number of people short bitcoin, people that are long bitcoin will panic and sell. Look for the bubble to pop in the first half of 2018!

    • You can already short bitcoin, for instance on the bitfinex exchange.

      And when a massive number of people short bitcoin, people that are long bitcoin will panic and sell

      Maybe not. Maybe they'll buy some more, thanking you for the low prices. And then the shorts have to panic buy. But if you're so sure that it's going to crash, why don't you open a short position yourself ?

    • by inking ( 2869053 )
      You could short all major cryptos for ages now.

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