To date, bitcoin ETFs have not been approved by U.S. regulators. Several ETF issuers filed plans earlier this year for such products, but the plans were scrapped because, at the time of those filings, there was not a bitcoin futures market.
Derivatives help increase liquidity and improve markets for an asset category by allowing investors to bet on ups and downs of an asset, evening allowing individuals to adopt market-neutral strategies. They are also a key component in the creation of many futures-backed ETFs utilized by a range of investors.
“Hosp’s forecast would represent a $45,000 rally from the current price of bitcoin — or a $10,000 collapse, underscoring the volatility of the world’s largest cryptocurrency,” according to CNBC.
For more information on the cryptocurrency market, visit our Bitcoin category.