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Intercontinental Exchange announces cash-settled Bitcoin futures

ICE Futures Singapore and ICE Clear Singapore have announced that their cryptocurrency trading platform, Bakkt, will soon be launching Bitcoin monthly futures contracts settled in USD.

The exchange, which is regulated by the Monetary Authority of Singapore, is the first fully regulated futures exchange for digital assets in the country.

President of ICE Futures Singapore Lucas Schmeddes said:

“Our new cash-settled futures contract will offer investors in Asia and around the world a convenient, capital-efficient way to gain or hedge exposure in Bitcoin markets.”

The contracts will be listed by Bakkt Singapore starting on December 9.

Bakkt already offers cash-settled futures contracts for Bitcoin in other jurisdictions.

However, Bakkt’s current trading products have experienced slow uptake, and despite open contracts rising by 77% in October, the volatility of the current Bitcoin market raises concerns over Bakkt’s sustainability.

Bakkt scrambles to add new products

Bakkt has previously been touted as a “huge catalyst for institutional participation in the crypto market”, but its highly anticipated launch failed to impress.

Although Bakkt CEO Kelly Loeffler maintains that the exchange has made “tremendous progress” since its launch, there has been a significant lack of interest from institutional investors.

Last week, Bakkt announced that it will be launching an institutional custodial platform for digital assets, which has received a green light from the New York Department of Financial Services.

Despite this, Bakkt’s scramble to add new products across different jurisdictions may be an effort to increase participation in what has so far been an underwhelming start for the exchange.

Bitcoin price fears

The news also comes amid growing uncertainty about the price of Bitcoin, which has seen a dramatic slump during the last few weeks in what some have speculated is the beginning of a new bear market.

Coin Rivet reported earlier today that $100 million worth of BitMEX long positions in Bitcoin have been liquidated, as the price of BTC plummeted below $7,000. Now, for a bullish trend reversal, Bitcoin must close above its 50 EMA tonight at $8,725.

Many traders have speculated that cash-settled futures on Bitcoin options may actually be detrimental to Bitcoin’s price, as these contracts don’t settle in Bitcoin and may also increase short-term volatility.

 

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