How Regulators Should Approach The Bitcoin Derivatives Market
We already know of bitcoin's complicated relationship with governments and regulatory agencies the world over. But bitcoin's relationship with the US Commodity Futures Trading Commission (CFTC), the agency responsible for regulating the futures and options markets, is particularly ill-defined. Bitcoin is in a Catch-22-style bind. As long as the price remains volatile it will remain dangerous for merchants to accept the cryptocurrency, barring adoption on a massive scale. Derivatives might be a useful risk management tool to hedge against volatility. But regulatory ambivalence leaves....
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The world's largest cryptocurrency exchange is reportedly being probed by the CFTC over concerns it facilitated crypto derivatives trading for U.S.-based customers. Binance, the world’s largest cryptocurrency exchange by trade volume, is reportedly under investigation by the United States Commodity Futures Trading Commission regarding possible trades made by U.S.-based customers.Binance Holdings Ltd is being investigated by the watchdog concerning possible derivatives trades made by American customers, Bloomberg reported on Friday, after being tipped off by an anonymous source.The exchange....
Over the past two months numerous regulators have issued warnings against the use of digital currencies, and some have even taken concrete steps to halt trading, most notably China and India. Israel, however, appears to be taking a different approach. Israeli regulators are not ignoring digital currencies, they are simply waiting to see what the rest of the world does about them. Certain Israeli financial institutions are engaged in bitcoin transactions, and they would like to see clear guidance from regulators. However, the Bank of Israel, the Israel Securities Authority and government....
Industry players at the Virtual Asset Service Providers Summit urged regulators to rethink their approach in light of DeFi and DEXs.
The disclosure comes shortly after U.S regulators' crackdown on retail competitor BitMEX.
For years, the cryptocurrency industry has had a complicated relationship with regulators. An example of regulatory pushback within the crypto space was when Facebook-backed Diem tried to launch its stablecoin. Regulatory limitations have undoubtedly had an impact on derivative brokers and exchanges. Just recently, Binance, one of the biggest exchanges, was forced to shut down crypto derivatives in several countries, including Germany, Italy, and Hong Kong. Since this announcement, derivatives traders have been on edge about what this means for the derivatives market and, most importantly,....