Heath Tarbert (pictured), chairman of US’ Commodities Futures Trading Commission (CFTC), has stated ethereum futures are likely to launch next year after the regulator clarified eth is a commodity.
“I’d say it is likely that you would see a futures contract in the next six months to a year,” Tarbert said before further adding:
“The volume to which it’ll trade, no idea, that’s where the markets decide, but my guess is now that we’ve provided at least… a little bit more clarity on [ether’s eligibility for futures contracts], my guess is market participants will consider that.”
There’s no known plan by any Wall Street provider to launch eth futures at this stage, with CME stating they’re focusing on bitcoin options.
If futures are launched, however, there might be upwards price pressure as traders buy spot eth to hedge the probably fiat settled futures to begin with.
That in part might have contributed to bitcoin’s rise in 2017, with the anticipation for futures creating quite a bit of expectations.
In the case of eth it might be slightly different as it wouldn’t be the first, but it would distinguish it from other cryptos to make it more bitcoin and eth, rather than just bitcoin.
That would give it greater market access and more maturity, opening the way for eth options and other more sophisticated trading instruments.
Yet it would also give Wall Street a regulated way to short it with some blaming bitcoin futures for the price fall.
As eth spot trades on unregulated exchanges, fiat settled futures could give big money a way to manipulate the spot price to profit from the movements of the futures price.
That however presumably would be after they buy eth, so price might initially rise once futures are announced, with such announcement now more likely in months than weeks, but the door has been opened.