Leo Melamed, Chairman Emeritus of CME Group, declared last Tuesday that Bitcoin is more than a cryptocurrency and there is possibility that Bitcoin becomes a new asset class such as stocks or gold in its own right, which can be traded by major investors and as well regulated by a body.
CME Group, which is the largest derivatives exchange in the world, announced last week that it would launch the futures contract of bitcoin, marking a major step in Bitcoin’s path toward mainstream acceptance.
According to CME’s Melamed “he expects major investors to take part in bitcoin futures, which the exchange plans to start by the end of year.”
The futures contract of bitcoin will allow investors to short-sell bitcoins, this will make two ways bets possible, a development that Melamed believes will attract not just speculators but major institutional investors as well.
The bitcoin price has experienced a Six-fold gain this year, and this has stirred up a debate among financial professionals on whether Bitcoin actually represent a revolution in financial technology or just another tech bubble.
To this the Chief Executive of JPMorgan Chase & Co, Jamie Dimon, said in September that Bitcoin “is a fraud” and will blow up while regulators in many nations tightened their grip on its trading.
CME’s Melamed, said while he was initially skeptical about bitcoin, he noticed some similarities between it and International Monetary Market currency futures trading, which he launched as chairman of the Chicago exchange in 1972.
He concluded by saying that bitcoin would soon go beyond being just a cryptocurrency and would represent a new asset class based on blockchain technology.
Pundits added by saying that blockchain will enable the transfer of assets without a centralized system such as banks and this will cause a drastic reduction in the cost of money transfer.