December noticed the launch of Bitcoin futures on each the CBOE and CME. Since then, buying and selling quantity has steadily elevated as merchants in Hong Kong flip their backs on their much less safe home exchanges in favor of regulated US markets.
TD Ameritrade CEO Gary Leung claims his is one such agency experiencing elevated curiosity in Bitcoin futures popping out of Hong Kong, explaining to the South China Morning Post:
We have acquired a number of inquiries about Bitcoin futures since we began working in Hong Kong final October, when the costs have been surging.
This newfound curiosity in American exchanges for Bitcoin futures stems largely from the truth that the Hong Kong Monetary Authority views the cryptocurrency as a commodity, and thus doesn’t regulate it.
Benny Mau, managing director at China Securities International Finance Holdings, defined to the South China Morning Post:
Bitcoin and different digital currencies are principally not regulated in Hong Kong as a result of they’re traded like commodities. If the digital forex platforms have an issue or are hacked, the buyers might endure losses as a result of the regulators may not do something for them. This has discouraged many Hong Kong buyers from buying and selling digital currencies in Hong Kong.
Instead, Hong Kong buyers trying to make the most secure trades potential are using US exchanges, since “buyers don’t want to consider the counterparty threat or fear concerning the platforms having an issue.”
According to Gary Cheung, chairman of the Hong Kong Stockbrokers Association, Bitcoin futures buying and selling within the US isn’t restricted to a particular subset of Hong Kong merchants. Rather, there are two varieties of Hong Kong buyers who commerce Bitcoin futures in America:
There are bitcoin miners and different buyers who commerce bitcoin and wish to use the futures merchandise to hedge. The others are regular futures buyers who purely wish to take revenue created by speculative futures buying and selling.
Both varieties of buyers have up to now made it abundantly clear — in the case of investing in Bitcoin futures, regulation is seen as considerably extra engaging than unregulated markets.
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