As you may or may not be aware, cryptocurrencies are the current hot topic in the financial industry.

Yesterday (Oct. 31, 2017) CME Group announced they would be offering bitcoin futures trading by the end of this year. This announcement sent the price of bitcoin to record highs – near $6,570.

This announcement is not only good news for individual investors but for institutional investors as well who have been anxiously waiting for the regulations to change – with this move, they may now be able to invest in bitcoin.

Supply Scarcity and Stores of Value

Bitcoin can be compared to Gold.  Both are “mined” and can be stored in hopes of future appreciation.  As Gold is mined from the earth, bitcoin is created or “mined” through technology – with very strict limits.  These limits mean that as demand for bitcoin soars, so does it’s price.

As stores of value, many investors perceive gold and, more recently, bitcoin as second to none.  Since 1971, gold has appreciated from $35 per ounce to around $1,300 at the time of this writing, a gain of over 3,500%.  Bitcoins have done even better.  On July 19, 2010, a bitcoin was worth $0.08.  At the time of this writing, it’s priced close to $5,300 per bitcoin, a gain of over 6,000,000% in seven years.  Not bad!

By Bluford Putnam and Erik Norland for CME Group

Once the official launch date of the Bitcoin futures contract is released, we will contact our clients with further information.

If you have any questions regarding cryptocurrencies, please feel free to contact me to further discuss.

To open your own futures trading account, please visit our New Accounts web page…

 

Best Wishes,

 

Joe Fallico
Principal Futures Broker
Series 3 & Series 30 Registered

Toll Free: 1-866-892-2030 – ext. 101
Phone: 1-847-379-5000

Insignia Futures & Options, Inc.

 

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