Nasdaq Inc plans to launch a futures contract based on bitcoin in 2018, making it the third exchange operator to plan US derivatives contracts linked to the digital currency, a source with knowledge of the matter said on Wednesday. The price of bitcoin topped $11,000 on Wednesday less than a day after passing the $10,000 mark and has increased more than 10-fold in value so far this year, prompting concerns of a bubble.
CME Group, the world's largest derivatives exchange, and CBOE Holdings, have both said they plan to launch futures products based on bitcoin this year, pending regulatory approval, helping fuel the crypto-currency's rally. While Nasdaq does not have a hard date set for its product, the transatlantic exchange operator has offered an exchange-traded note based on bitcoin on its Stockholm exchange since 2015.
Nasdaq has teamed up with New York-based money manager VanEck to develop the futures contract, which will be cleared by the Options Clearing Corporation. The OCC clears all Nasdaq futures products, the source said. VanEck had applied to the US Securities and Exchange Commission (SEC) this year to launch a bitcoin-related exchange-traded fund, but withdrew the request in September after speaking with SEC staff, according to a regulatory filing.
The SEC requested that VanEck wait until the underlying instruments in which the ETF planned to primarily invest - bitcoin futures contracts - become available for investment, the filing said. A representative for VanEck was not immediately available for comment. One of the ways the Nasdaq futures product will differ from CME's and CBOE's is that it will be based on an index that takes in prices from more than 50 bitcoin exchanges, the source said.
CME has said it's bitcoin future will be based on the CF Bitcoin Reference Rate (BRR), a once-a-day reference rate of the US dollar price of bitcoin, that currently takes prices from four bitcoin exchanges. CBOE will price its bitcoin future off the Gemini Trust, the digital currency exchange founded by brothers Cameron and Tyler Winklevoss. The SEC in March denied a request for CBOE to list what would have been the first US ETF built to track bitcoin.
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