Technology

First-ever bitcoin futures trading is now underway

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Broken representations of the bitcoin virtual currency, placed on a monitor that displays binary digits, are seen in this illustration picture, December 8, 2017.

Broken representations of the bitcoin virtual currency, placed on a monitor that displays binary digits, are seen in this illustration from Dec. 8, 2017.

Credit:

Dado Ruvic/Illustration

The virtual currency bitcoin is now trading on a major global exchange for the first time.

The first-ever bitcoin futures started trading on the Chicago Board Options Exchange on Sunday.

The price of the virtual currency has soared in recent weeks. And so far, it appears investors believe bitcoin will continue to rise in value, the BBC reports.

Some also see futures trading as a sign that bitcoin is creeping into the mainstream.

“I think it’s a big deal in that it allows institutional investors to start putting bets on the technology,” said Peter Van Valkenburgh, director of research at Coin Center, a nonprofit that looks at public policy issues raised by digital currencies like bitcoin.“I think more people looking at it [and] more money-making trades will lead to a better understanding of the long-term value proposition of the technology.”

But there are skeptics.

“Just introducing a futures contract doesn’t legitimize anything, frankly,” said Paul Donovan, the chief global economist at Swiss banking giant, UBS. “It shows there’s interest. And absolutely, there’s interest. There’s always interest in a bubble. That’s the defining characteristic of a bubble. You suck people into it.

For more on what the bitcoin futures trading means for the cryptocurrency, listen to an interview with Peter Van Valkenburgh by clicking the play button above. 

In Science, Tech & EnvironmentTechnology.