Bitcoin Futures: What You Need to Know

Bitcoin is virtual money-based on a digital currency that can be bought, sold, traded, and transferred. However, it is gaining popularity as a form of payment and is already accepted by thousands of businesses. However, there is still a lot of confusion among potential users. Bitcoin is fascinating, complicated, and often misunderstood. In this guide, we will give you the low-down on what Bitcoin is, what its future looks like, and the best way to invest in Bitcoin futures.

Bitcoin futures are now offered on a few exchanges. This is huge for the bitcoin community, as it allows investors to bet on the future price of bitcoin while remaining confident that they won’t be stuck with a dead asset on their hands. With this, many bitcoiners are expecting the price of bitcoin to increase and make bitcoin a more widely accepted currency.

Bitcoin futures are a new way of investing in Bitcoin. They’re the first real-time, regulated Bitcoin contracts. They trade on in the same way that other futures contracts do, but Bitcoin futures are cash-settled in a public exchange.. Read more about bitcoin futures symbol and let us know what you think.

You can learn about Bitcoin trading without holding the actual cryptocurrency thanks to Bitcoin futures. Bitcoin futures allow you to speculate on the cryptocurrency’s future price without actually owning it. The Chicago Merc provides cash contracts on a monthly basis. When you settle a contract as an investor, you take cash rather than Bitcoin.

On December 10th, 2017, the first Bitcoin futures contract was established. It was provided by the Cboe Options Exchange, which continued to sell new contracts until March 2019. Bitcoin futures are traded on exchanges including the Intercontinental Exchange and Bakkt.

In a nutshell, here’s all you need to know about Bitcoin futures trading:

  • Bitcoin futures are not based on the real Bitcoin money.
  • You are not in the business of buying and selling Bitcoin. Instead, you’re gambling on Bitcoin’s price.
  • To trade Bitcoin futures contracts, you don’t require a wallet or a cryptocurrency platform.

What are the benefits of Bitcoin futures?

Bitcoin futures may pique your attention for a variety of reasons:

Security and trustworthiness

Bitcoin futures provide a degree of security that gives investors the confidence to trade them. Bitcoin futures are traded on a Commodity Futures Trading Commission-regulated exchange (CFTC). This autonomous government agency promotes market efficiency in addition to regulating commodities futures trading. 

It also safeguards investors from market manipulations, fraud, and unfair trade practices. In other terms, it safeguards investors’ interests. The Commodity Futures Trading Commission Act of 1974 created the CFTC.

Large institutional investors may now engage in the market without worrying about their safety, thanks to a platform like this that safeguards the interests of traders and investors. The degree of risk has been significantly decreased, resulting in an increase in the level of confidence that individuals have in the system.

There is no need for a wallet or an exchange.

Bitcoin futures are cash-settled. Therefore, you do not need a Bitcoin wallet before you can be a part of the business. There is no Bitcoin exchange in the transaction. The advantage of this system is that you do not own the underlying cryptocurrency, which means you are not at risk of holding a currency with high market volatility that may yield some losses in cases of unfavorable price changes and market sentiments. Also, it excludes you from the cost of holding Bitcoin.

Exposure to danger is limited.

The risks you face while trading Bitcoin futures are restricted by price restrictions and position limits. The position limit establishes your ownership at certain points. The goal is to prevent a scenario in which a trader or investor manipulates the price and affects the market for their own benefit at the cost of other traders and investors. 

Where may Bitcoin futures be traded?

Initially, several cryptocurrency exchanges served as marketplaces for Bitcoin futures. Cryptocurrencies, on the other hand, were unregulated. These platforms were not appropriate for traders who were serious about their endeavors because of the danger associated with them. 

CME 

With the addition of Cboe and CME to the picture, Bitcoin futures trading has seen a significant boost. While Cboe has stopped trading, CME has grown significantly. For example, there are Micro Bitcoin futures. 

ErisX

Another exchange where you may trade Bitcoin futures is ErisX. It provides cash-settled Bitcoin futures trading and regulates the system with upper and lower limits. The market’s headquarters are in Chicago.

Bakkt

Bakkt is another option for trading Bitcoin futures. Intercontinental Exchange introduced Bakkt in 2019. (ICE). It offers a “integrated platform that allows individuals and institutions to purchase, trade, store, and spend digital assets over a worldwide network in real time.” Futures trading is one of the first things that comes to mind.

Binance and OKEx are two cryptocurrency exchanges.

OKEx and Binance are two more exchanges that provide great platforms for buying Bitcoin futures. Binance is a cryptocurrency exchange known for having a large number of open interest contracts.

Searching for a broker

If you want to succeed in the market, becoming a futures broker may be a fantastic investment. You may use the services of many professional futures brokers to get the most out of your trade. Here are a few of the finest to choose from:

TD Ameritrade is a brokerage firm based in New York City.

ThinkorSwim, a subsidiary of TD Ameritrade, provides Bitcoin futures trading services. The platform is NFA-registered and self-regulated. There is no minimum amount required to create an account on the site. However, in order to obtain margin rights, you must have up to $2,000 in your account. The site is appropriate for novices since it provides educational resources. Beginners will find it simpler to catch up. It also includes provisions for new trader bonuses. 

FOREX.com

FOREX.com is NFA-registered and conducted futures trades indirectly via its subsidiary FuturesOnline. You’ll need to deposit $2,500 and establish an account with enough funds to satisfy margin requirements. You must have a minimum of $500 in your account to trade Bitcoin futures on this platform. 

If you let your account lie inactive for three months, the platform has a regulation that you must pay $15 each month. This platform has a great deal to offer that prioritizes the user. It provides a demo account with a $50,000 virtual dollar deposit to allow newcomers to test the platform, assess their strengths, and test their tactics for free. Other interesting deals are available on the platform.

Interactive Brokers is a brokerage firm that specializes in trading

Interactive Brokers provides services in a variety of markets, including Forex, fixed income, and Bitcoin futures, among others. The margin rates on this platform are among the most competitive in the industry. However, when compared to other platforms, it may be more costly. They have a great commission structure and work philosophy.

Trading advice Futures on Bitcoin

Bitcoin Futures: What You Need to Know 2

Trading Bitcoin futures may be a profitable enterprise if you are well-prepared. It will be easier to handle if you are well prepared and have a strategy in place for trading Bitcoin futures. Here are some pointers to help you enhance your trading success and experience with Bitcoin futures.

Make a trading strategy.

Create a strategy for trading Bitcoin futures. Make sure you consider the market you’ll be trading in while drafting your strategy. There are some market habits to consider. Any market activity that may influence your transaction should be taken into account. You don’t want to put on a show as a newcomer to the industry.

Have a definite goal in mind.

Your trading strategy must have goals. You must have objectives that you want to achieve. To meet them, you must put forth the effort. You may have budgeted for a certain amount of profit. While certain things are beyond your control, you may use your trading skills to influence events to your advantage.

Know how much risk you’re willing to accept.

Every transaction has its own set of dangers. Dedicating your time and money to trading is a big move that should pay off handsomely. If anything goes wrong and the market isn’t in your favor or your predictions aren’t as accurate as you believe, you should be able to suffer the consequences. Consider the risks associated with your transaction and if you can withstand them if anything goes wrong.

Make plans to do your schoolwork.

To assist you in your trade, you’ll use various technical and fundamental analytical indicators. You will get indications to purchase and sell digital money as a result of this research. You must also be certain about the ordering you want to employ. You’ll need a strategy for staying on top of market trends and movements. 

Another thing to think about is your financial management. The market is dynamic, and you can’t predict how prices will change. The importance of position sizing cannot be overstated. Before getting into Bitcoin futures trading, it’s a good idea to make a mental note of these points. 

You may need assistance when taking notice of these trading techniques and making appropriate preparation in this regard. You may utilize a strategy from professionals and other experienced investors and traders if you are having trouble coming up with your own plan or are unsure in certain areas. 

Conclusion

If you have access to the required information, trading Bitcoin futures is simple. You’ll need to use an exchange to swap. Price discovery and transparency will be aided by a proper exchange. You may get started right away with a simple registration and the submission of your personal information.

Disclaimer: The material on this website is not intended to be trading advice, and.com assumes no responsibility for any investments made as a result of the information on this page. Before making any financial choices, we highly advise doing independent research and/or consulting with a competent expert.

The bitcoin network has been active for over ten years now, but the way it is used is still in its infancy. BitQuick, a company that offers bitcoin exchange services, is using the network to trade bitcoin futures, which will make bitcoin much more accessible to the average person.. Read more about what time does cme bitcoin futures open and let us know what you think.

Frequently Asked Questions

Can you make money with Bitcoin futures?

Yes, I can make money with Bitcoin futures.

How long can you hold Bitcoin futures?

Bitcoin futures are a type of derivative product, which means that they have an expiration date. The expiration date for bitcoin futures is December 31st, 2020.

Related Tags

This article broadly covered the following related topics:

  • bitcoin futures cme
  • bitcoin futures price
  • bitcoin futures margin
  • bitcoin futures explained
  • cme bitcoin futures

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