Bitcoin Price Reaches New Record High Close to $8,100
As the cryptocurrency market continues to climb, bitcoin prices reached new heights last night.
With values picking up from around 15:50 UTC yesterday, the cryptocurrency peaked some five hours later at a new all-time record of $8,099.85.
Today, prices are slightly down, but holding well. The session opened at $8,034, and at press time the price of 1 BTC is $8,042, according to CoinDesk’s Bitcoin Price Index. That marks an increase of 0.07 percent for the session so far.
As per CoinMarketCap, bitcoin is up 3.66 percent for the last 24 hours, and around 27 percent over the last 7 days. The cryptocurrency’s market capitalization has now peaked at over $133.86 billion.
The combined market value of all cryptocurrencies is also at record levels, being worth $238.8 billion at press time.
Floating lamp image via Shutterstock
Written by CoinDesk
First Long-Term LedgerX Bitcoin Option Pegs Price at $10,000
LedgerX just initiated its first long-term bitcoin futures option.
Called a Long-Term Equity Anticipation Security (LEAPS), the trade was matched by the platform this morning and is set to expire on December 28, 2018.
Under the terms of the deal, the buyer has the right to buy bitcoin at a price of $10,000 at that date, or almost a 30 percent premium on today’s price.
Yet, because the buyer only makes money if the price is more than $10,000 (called the strike price), the investment can be seen as a reflection of the level of confidence that the price will reach that level by the agreed upon date.
Such long term futures options have long been seen in the industry as a much needed sign of maturity, and could in part help pave the way for even more institutional money to enter the space.
In an exclusive interview with CoinDesk, LedgerX CEO Paul Chou sought to position the milestone as just the first of many more before the cryptocurrency market can truly be considered mature.
“There will be, I expect, a lot more trades down the line. This is the first one, but it at least gives you the first guess from different institutional traders as to what bitcoin’s dynamics will look like from now until 2018.”
The trade option was listed by LedgerX late Friday night, and to Chou’s surprise, two institutional investors agreed to the terms of the deal just one day later.
Under the terms, the buyer agreed to a price of $2,250.25 for the trade, meaning the seller collects that money if the price is less that $10,000 by the end of next year, and the buyer gets to purchase bitcoin at the strike price if it is higher.
Unlike a futures swap however, the buyer is not obliged to purchase the asset.
“If the price goes to zero, you don’t have to pay $10,000 for it,” Chou said. “But if a year from now it’s at $20,000, then you can exercise your options.”
Based on LedgerX’s own calculations (made using the Nobel-prize winning Black-Scholes financial markets model), the startup believes there is a 25 percent chance that bitcoin will reach that level in the allotted time.
While this is the first LEAPS financial instrument matched by New York-based LedgerX, they’ve been conducting increasingly high trade volumes since their soft launch a month ago.
As reported by CoinDesk, LedgerX traded $1 million in bitcoin derivatives its first week of trading, ending Oct. 20.
Since then, the first cryptocurrency firm to be granted a derivatives clearing organization (DCO) license by the CFTC has posted a $1 million day, a $1.6 million day and on November 15, a record $2.6 million day.
Since LedgerX listed the LEAPS option at 5:30 Friday evening, Chou says they saw an additional $500,000 traded before midnight. “That’s for a holiday week too,” he said. “So we were shocked.” He estimates the company has conducted approximately $16 million in notional bitcoin transactions to date.
While the startup’s numbers seem to indicated active early interest, legacy institutions such as the Chicago Mercantile Exchange (CME Group) and the Chicago Board Options Exchange (CBOE) have both recently revealed their own similar plans.
Though Chou hopes to maintain his first-mover advantage, he said there’s no hard date to launch into full operation. Rather, his team wants to make sure the platform scales well beyond the 1 million messages it sends per day before this milestone. He says he’d be “surprised” if that takes “more than a month,” concluding:
“But it might be sooner.”
Crystal ball image via Shutterstock
Written by CoinDesk
Massive Hedge Fund AQR Incorporating Blockchain Technology
In another win for the adoption of Blockchain technology into the banking and finance world, top hedge fund AQR ($208 bln under management) has announced that it will begin investigating how to incorporate the nascent technology into its trading platforms.
The company hopes to use the technology to make its internal systems more efficient, since Blockchain allows for security without the increased hassles that traditional security means employ. Nevertheless, the company has only just begun to test the potential. According to AQR cofounder David Kabiller:
“How long [the technology] takes to get there and what becomes the standard is unclear, there’s a big entrenched infrastructure there, but there is potential for more efficiencies that can be gained by Blockchain.”
Hedge funds business and tech
Hedge funds have been on the cutting edge of embracing both Blockchain technology and cryptocurrencies among institutional investors. The need for profit production for investors and high returns has driven the push for new fields of investment and efficiency. Recent reports indicate that more than 120 new hedge funds for cryptocurrencies have recently opened. Just last week, UK-based hedge fund Man Group announced they would get involved in Bitcoin trading following CME Group’s opening of their regulated Bitcoin futures market. This market opens for testing Monday, November 20.
Written by CoinTelegraph
Israel Might Finally Issue Clear Bitcoin Regulations
Ambiguity can be dreadfully annoying when it comes to matters of law. Such is the case of bitcoin use in Israel, where citizens have yet to receive any official word on the subject. Soon, however, this issue might finally be resolved.
On Tuesday it was announced that the Israeli Ministry of Finance will establish a working team on digital currencies together with the heads of the big accounting firms and relevant professional chambers.
This was decided at a meeting initiated by Finance Minister Moshe Kahlon with the same bodies, where they acknowledged that Israel has not prepared well enough to handle the issue of digital currencies so far.
One of the people who has been pushing for this is Israeli serial entrepreneur (and vocal bitcoin advocate) Moshe Hogeg. He met with the finance minister last month to promote the issues of blockchain and cryptocurrencies.
Speaking today with news.Bitcoin.com, Hogeg said: “We are leading this with the minister and very happy to see he is all for it.” As for a potential timetable, he added: “The committees will begin their operations very fast. In my opinion, we will see results on the ground in up to six months.”
Current State of Ambiguity
As mentioned above, the current lack of official regulations on bitcoin has created a lot of trouble in Israel for both end users and businesses in the field.
In June the Tel Aviv district court ruled that banks can deny service to bitcoin-related ventures, such as exchanges due to the banks’ inability to verify their own KYC and AML obligations before the law. And in the beginning of the year, the Israeli Tax Authority determined that if bitcoin is not legally defined as a currency, the sale of it will be subject to a number of taxes that can severely hurt adoption.
It also needs to be remembered that whatever recommendations will eventually come out of the working team, they are not likely to be too supportive. At least one high-ranking Israeli public official is known to be rather concerned about the harmful potential of cryptocurrencies and the team is certain to hear from him.
Professor Shmuel Hauser, Head of the Israel Securities Authority (ISA), has spoken out for a need by regulators to take a ‘paternalistic’ approach regarding both ICOs and bitcoin. The ISA has since established its own committee for assessing possible regulations in Israel.