The CME Group has a pending application with the Commodity Futures Trading Commission (CFTC) to list a Bitcoin futures contract.

Start up Ledger X began trading Bitcoin futures as the first US regulated cryptocurrency exchange last month.

The CME Group says its their turn comparing Bitcoin to Gold.

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The CME Group Makes the Case That Bitcoin Needs a Futures Market

Last month we reported that bitcoin derivative trading had begun at start-up Ledger X. In that report we noted that we expected the CME group to follow suit.

The CME Group has indeed announced that they have an application at the CFTC to launch a bitcoin futures contract that they are confident will be approved.

Terry Duffy, CME Group chairman and CEO, said in an interview this week with CNBC “you cant ignore the fact that [despite some nefarious uses for bitcoin], this is more and more a story that won’t go away and mainstream companies want access to bitcoin and that there is huge pent up demand from clients not just on the speculative side but on the commerce side.”

He also noted that Japan had passsed regulations that allow eleven different exchanges to provide Bitcoin reference prices.

CME Group's Duffy on #bitcoin futures launch: People are looking for more efficient ways to do commerce https://t.co/FE1iKaea3l — Smaulgld (@Smaulgld) October 31, 2017

The CME group also published an article “The Evolving Economics of Bitcoin, Gold and Fiat Currencies“ arguing that bitcoin, despite its volatility, is a store of value.

When pitching your futures regulatory approval Bitcoin becomes a "Store of Value" https://t.co/WzRYIhEwvM — Smaulgld (@Smaulgld) November 2, 2017

“However volatile they may be, the reason why gold and bitcoin are perceived as stores of value is simple: their money supply doesn’t grow quickly and, in the case of bitcoin not at all, some day. Both gold and bitcoin money supply growth is determined by mining output.”

Clearly the CME group is promoting the concept that Bitcoin is digital gold and therefore ripe for a futures market. Other points made comparing the gold to bitcoin:

“Ethereum, Zcash, dash, ripple, monero etc. compete with bitcoin just as silver, and to a lesser extent platinum and palladium, compete with gold. This might keep bitcoin’s value in check before it rises another 10 or 100-fold in value.”

“Gold and bitcoin have been great, if erratic, stores of value.

Gold and bitcoin appreciate because of the slow growth of mining supply.

Strong stores of value encourage hoarding, deflation and financial instability.

They also make for poor units of account and methods of deferred pay.”

Questions:

Is Bitcoin a store of value?

Is bitcoin “digital gold”?

Will the CME Group application be approved by the CFTC?

Will the contract if approved attract significant institutional interest?

What impact will it have on the price of Bitcoin?

Will it make Bitcoin more or less subject to manipulation?

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