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The Almighty Buck

Launch of Bitcoin Futures Trading Crashes CBOE Site ( 97

"5PM CT is the start of Bitcoin futures trading and the $CBOE website appears to be down," one market watcher posted on Twitter (and his observation was quickly confirmed by other cryptocurrency-watching accounts and confirmed by CBOE). "I'm guessing watching Bitcoin futures start trading is a more popular spectator sport than anticipated."

Bitcoin futures will also begin trading on the Chicago Mercantile Exchange in eight days. The Street report that the anticipation of that "has triggered wild swings in bitcoin prices over the last week." Overall, trading bitcoin futures is a positive development for the cryptocurrency says the research team at Fundstrat... The introduction of derivatives lays the necessary market structure for institutions to allocate cash towards cryptocurrencies, points out Fundstrat... Short sellers may now express negative views on bitcoin, which could lead to short-term pricing pressure. But the ability for short sellers to hate on bitcoin could be viewed as a longer term positive, Fundstrat says. Shorting essentially creates true price discovery and means that hedge funds could take bitcoin more seriously. This should improve the long-term prospects of bitcoin as it broadens sponsorship, Fundstrat believes.
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Launch of Bitcoin Futures Trading Crashes CBOE Site

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  • by Anonymous Coward

    Bitcoin is like Trump. Unstable.

    • Where can I get a betting line on Trump's antics?

      Bitcoin futures can put the lottery and bookies out of business. Who is 'making' this market? At this volatility? Good luck to them, if it works it will be insanely profitable. There are tons of compulsive gamblers, just got to get between them and the lottery vendor.

      Needs a good web frontend for short term simple bets: e.g. bet (er invest) $___ 1:1, 10:1, 100:1 (long/short) for market clearing in 15 minutes. Bang, verify, clear payment, bets on.

    • Re:Bitcoin (Score:5, Funny)

      by Rockoon ( 1252108 ) on Sunday December 10, 2017 @08:19PM (#55712975)
      My daughter asked me to buy her $10.00 in bitcoin, so I asked her why she wanted $12.38 in bitcoin. She said she needed $7.92 in bitcoin so that she could subscribe to a podcast. I told her $19.52 was way too much for a podcast subscription. She stormed off upset that I wouldnt give her the $11.41 in bitcoin that she wanted.
  • Close (Score:4, Interesting)

    by Orgasmatron ( 8103 ) on Sunday December 10, 2017 @07:32PM (#55712833)

    Not all shorts help with price discovery. Covered shorts do, but naked shorts are just plain fraud, no matter what excuses the clearinghouses come up with.

    • Honestly I am surprised that BTC has come this far. I never would have guessed it would be allowed on any of the exchanges in this direct of a fashion. But NOW, it would be fairly interesting to watch.

      I wonder what category this security would fall under. Probably currency but can it be considered under âoeEnergyâ? Considering thatâ(TM)s itâ(TM)s primary input.

      • Re: (Score:3, Insightful)

        by Joce640k ( 829181 )

        Honestly I am surprised that BTC has come this far. I never would have guessed it would be allowed on any of the exchanges in this direct of a fashion.

        Why not? A commission is a commission. Let the fools gamble, the house never loses.

      • Honestly I am surprised that BTC has come this far

        We all are
    • by icejai ( 214906 )

      It's not always that black and white.

      Kickstarter and Indiegogo can also be seen a market where products are almost exclusively sold as naked shorts.
      And yeah, many of them end up accused of fraud.

      Naked Short selling is also pretty common in the real world.
      IT companies sell contracts for services that don't exist yet, farms sell milk that don't exist yet, refineries selling distallates they haven't even produced yet, miners sell aluminium to BMW for their engines that hasn't been mined or refined yet, etc.


      • Absolutely nothing that you listed is a short, much less a naked one, with the one exception of, thank God, an example of an actual naked short.

        Your examples were: venture funding, venture funding, development contract, hedging, hedging, hedging, naked short. Note that the first three do not happen on markets at all, while the hedging happens on markets that will enforce with the utmost strictness a very hard cap on your exposure. If you reach your credit limit on a futures exchange, the exchange itself

        • by icejai ( 214906 )

          You're correct in the context of stocks, but I'm not talking about just the stock market.

          The underlying principle of a naked short is the sale of an asset that is not owned by the seller. Naked, by it neither being borrowed.

          Giving a naked short other names one level down to add specificty and context (your accurate categorizations of my examples) does not subtract from the nature of the underlying transaction -- the sale of an asset that is neither owned, or borrowed. A non-existent asset would satisfy the

    • There are naked shorts with stocks, but there is no such thing as a naked short with futures.
      • by devman ( 1163205 )
        If you take a short position on a physically settled future for a product you do not produce (or haven't yet), that is essentially a naked short. Speculators do it all the time. It is no different than selling a call option, when you don't have the underlying, with the difference being an option may expire worthless, but a future contract always settles.
    • I'm not aware of naked shorts being allowed anywhere. Do you know of a place where such exists. You can write calls or buy puts, but you can't actually short any securities that i know of without first borrowing the underlying asset.
  • Can you short Bitcoin futures?

    • Yes. Not only can you buy puts on BTC,as well as shorting long options. However, both markets have relatively high volatility, so the costs to invest in these instruments could be a bit high for a while. Also not to mention the old saying that "The market can stay irrational longer than a man can stay solvent, " which should be observed in all cases.

      • Too complicated: Long/short, odds you want, duration (15 min, half hour, hour) amount of bet. Bang, deal should be done and legal. No account required, pre-paid CC accepted. No bitcoin.

        Use solar powered AI for your option pricing model!

        Damn SEC with its qualified option trader rules. Just doesn't want anybody cutting in on the state lotteries business IMHO.

        I think Joe sixpack should have just as much access to legal short term, high odds bets/investments, as wall street high rollers.

    • by devman ( 1163205 )
      Every futures contract has a long and short side. There are only two ways to acquire a future position, either you buy someone's obligation or a new contract is created when someone takes the opposite side of your position. For every party that is long, there is a party on the opposite side that is short. Much different from trading equities.
  • I need to by some now! Before it becomes a bubble.
  • by Anonymous Coward

    Bitcoin is now becoming a thing that matters. Welcome, geeks. We will short the thing that matters. We will speculate on the thing that matters. Websites and co providing crucial infrastructure for the thing that matters will be ill implemented. By morons. It's becoming a thing that matters because people believe that it matters. Not because of reality. Or because of physical presence or existence. Rawly because of believe.

    Welcome all.

    Welcome to nothing. Welcome to everything.

    Tulip mania 2.0. Now in bitcoin

  • Old saw: Those who know don't talk, those who talk, don't know, or are talking their book. Why should BC be any different - the ripoff artists in the casino haven't changed one bit. Yes, you can make money in tulips, or maybe we've reached a "permanent high plateau", or maybe someone strikes gold. But in the gold rush, the guys who made money either got out quick, or sold supplies to the prospectors. Similar stories for every bubble. You have been warned. The exit ramp is going to be very very crowd
    • don't worry, no money will be lost, not one cent.

      • All the energy that went into it is lost.

        • Yes, but the money paid for that energy was not. Don't worry about the energy, there is no shortage of energy on this Earth or in this universe. Take comfort that the money is never lost, only changes hands.

          • Of course there's a shortage of energy that we can easily harness, and generating energy creates pollution.

  • Just what the market needs, more volatility!

  • Other than the fact that after the 1637 crash I guess you could plant the bulb or maybe even cook it and eat it. []

    • What makes bitcoins different than tulip bulbs ?

      A tulip bulb cost almost nothing to create. You can't divide or combine them. They rot. They don't fit in your wallet.

      • Takes energy, water, fertilizer, time, etc - not at all free to create and actually more involved than just being a mining rig you just plug in. You can "split" them by reproducing them via seeds. But yes, it doesn't fit in a regular sized wallet, so I guess that is the distinction. Gold bars also don't fit in the wallet. The dot-com stocks had the form factor same as bitcoins however. Hmmm....

        • Takes energy, water, fertilizer, time, etc - not at all free to create

          Admittedly not completely free, but really cheap. And most importantly, there's no reason for the trade price to go much above the cost to grow one, which puts a natural ceiling on the bulb's prices. And while you can plug in the mining rig, you still need to pay for electricity and the equipment itself, and those costs go up with the price of bitcoin.

          You can "split" them by reproducing them via seeds.

          I was talking about splitting in the context of producing change for a transaction, or combining small amounts of change in order to make a bigger transaction

          • Why do costs of operating a mining rig go up as the price of bitcoins goes up? Do you claim bitcoin is driving electricity prices? Do you think that PC's and GPU card prices are driven by bitcoins much?

            • Why do costs of operating a mining rig go up as the price of bitcoins goes up?

              Because the amount of Bitcoin that can be mined is fixed at 1800 per day.

              As the price of bitcoin goes up, more people will start running a mining rig (or expanding it if they already had one). As the total mining hashrate goes up, the protocol will increase the difficulty level to bring the rewards back to 1800 BTC/day. This means that the difficulty (and therefore the operating cost) will tend to an equilibrium with the price.

      • It was quite literally a viral bubble:

        "The multicolor effects of intricate lines and flame-like streaks on the petals were vivid and spectacular and made the bulbs that produced these even more exotic-looking plants highly sought-after. It is now known that this effect is due to the bulbs being infected with a type of tulip-specific mosaic virus, known as the "Tulip breaking virus", so called because it "breaks" the one petal color into two or more." []

    • Sending money pseudonymously, independent of banks/corporations, across the globe in 10 minutes is much, much harder if you use tulips.
  • this is starting to look like the whole housing loan market scheme.

  • by Chas ( 5144 ) on Monday December 11, 2017 @08:38AM (#55715105) Homepage Journal

    I know the unmitigated yahoos running CBOE's back-end.

    Very "Let's do THIS!", then toss on a bunch of half-assed implementation, and then flipping a nut when things don't go as they imagined.

  • There, I said it; nothing bad happened to me. It's OK to point and laugh now.
  • "Big Men???" keep on turning
    Carry on like boys of sin
    Singing songs about the teen-girls
    He rapes 'ole' 'bamy once again and He likes 'em young

    Well I heard Mister Moore deny about her
    Well I heard ole Roy put her down
    Well, I hope Roy Moore will remember
    A southern folk don't need him around anyhow

    Sweet home Alabama
    Where the guys have not a clue (apparently)
    Sweet home Alabama
    Lord, it's startin' smell like poo

    In Ole 'Bamy they love the POTUS, boo-hoo-hoo
    Now we all did what we could do
    Now Pussy-Gate does not bothe

I use technology in order to hate it more properly. -- Nam June Paik