As the essence of investment in cryptocurrency reviews itself and the development are surfacing, Bitcoin futures have available been written from 2017, and they are becoming even more accessible with the increasing number of transactions.
Bitcoin futures are one of the elements which actually affect the decisions implanted on financial instruments for cryptocurrencies like Bitcoin.
Now, most of the investors are looking forward to having speculation about the price of Bitcoin, and some are looking at the predictions without even owning any Bitcoin at all.
That is the reason why Bitcoin futures are providing regulation for speculative purposes and that too in an effective manner so that the risk of the price fluctuations can be controlled largely.
The Definition of Futures Contracts
Bitcoin futures are a type of agreement on a contract that it mentions precisely the transaction like the buying or selling of any asset at a prefixed price which also comprises of a date in the near future. Both of the parties are supposed to fulfill the terms of the contract when it expires by buying or selling the aforementioned Asset at the aforementioned price. This contract can be of two different types- long and short. The long contract comprises of the terms and conditions that the party will agree to buy the acid in the future at a predetermined price while the shot price comprises of the terms and conditions that the party will agree to sell the acid at the predetermined price when the contract expires.
Futures contracts are the kind of agreements that are supervised by the commodity futures trading Commission, and they mostly have two purposes:
- Determining the price fluctuation of the underlying asset
- Controlling the risk of price fluctuation
Let us take an example that in the first case the community that is to be bought and sold is oil- and the selling party is thinking that the price of oil will be rising to some extent by the time the contract ends. Now the predetermined price will comprise of the present rate of the barrel in addition to the profit that he or she is expecting by the time the contract ends.
Now what happens is by the time the contract ends the price actually goes higher than the predetermined price. Even then the seller will have to accept the amount that is mentioned in the contract, and he or she cannot claim for the increased price of the barrel.
Therefore, you can understand that whether the buying on the selling party will be making most of the profit will depend on the kind of price fluctuations that happen in the future. But with the help of contract system, the loss extent can be controlled incredibly. This means that even if the price drop occurs, the seller will be able to get the profit percentage without having any adverse effects on the transaction.
Let us take a look at some of the most amazing platforms that have been offered in Bitcoin futures trading
Institutions That Are Actually Offering Bitcoin Futures Trading
CBOE- it is one of the most prominent Bitcoin futures trading platforms that you can get in the entire globe, and it had launched its first contract in December 2017 right after the Bitcoin futures Idea was launched. It has been able to set an example before the other platforms regarding the Bitcoin futures trading and this event many of the Other platforms started this contract launching as well.
Chicago Mercantile Exchange Group – Also known as the CME, this is Rashika ko based platform that holds the futures trading exchange. It has also been able to declare that it all throughout 2018 itself, it has been able to grow futures Bitcoin trading by at least 119%, which is an incredible performance.
Bitmex– this is also one of the largest platforms for cryptocurrency exchange, and it offers numerous Bitcoin futures trading options even though it is not viable by the US citizens.
Bakkt– recently the name of this Bitcoin futures trading platform has turned up, and it is supervised by the Intercontinental exchange which again owns the NYSE.
OKEx- it is a Hong Kong-based Bitcoin futures trading platform, but once again it is not supporting the US citizens.
Bitcoin futures trading is one of the best options for the investors in order to eliminate all chances of risk, and it has a number of other advantages. It gives proper legitimacy to all the underlying assets and makes the buying and selling process even more transparent than it already is. Bitcoin futures trading system is one of the most welcoming and Revolutionary changes in the segment of cryptocurrency, and there are numerous platforms which are conducting Bitcoin futures trading thus putting a significant step forward.