End of the volatility of Bitcoin?
But this announcement could also mean the end of the volatility of this cryptocurrency.
Because the GCE is planning to put fluctuation limits on Bitcoin that should protect investors against too large price differentials, which would help stabilize the cryptocurrency.
What fluctuation limits?
The proposed fluctuation limits would prevent deviations by more than 20%.
These protections already exist on US index futures, and this could help make Bitcoin prices less volatile.
Because the price of Bitcoin has since its existence increases and decreases of up to 40%.
These violent fluctuations would prevent the massive adoption of Bitcoin as a currency.
If its rate became stable, cryptocurrency could be recognized as a real currency while retaining its power as a store of value.
The GCE seems to have opened the door to others; The Chicago Board Option, also known as the Cboe Option, the largest US option exchange, also plans to offer Bitcoin futures.
Cboe Global Market President and Chief Operating Officer Chris Concannon said on Tuesday:
“And over time, we expect ETFs * to enter the market once the regulated futures market is built and liquid.”
* (Exchange Traded Funds)