- The chairman of the largest electronic brokerage firm in the US took out an ad in The Wall Street Journal to warn regulators about bitcoin futures.
- Interactive Brokers Chairman Thomas Peterffy doesn't think bitcoin is ready for the futures market and said bitcoin futures could pose a risk to the economy.
The chairman of the largest electronic brokerage firm in the US took out a full page ad in The Wall Street Journal Wednesday to warn regulators about the dangers bitcoin futures could present to traditional capital markets.
In the open letter addressed to J. Christopher Giancarlo, the chairman of the Commodity Futures Trading Commission, Thomas Peterffy, the chairman of Interactive Brokers, one of the largest derivatives traders and a provider of clearing services for hundreds of brokers, expressed his concerns about a proposal by the Chicago Mercantile Exchange to launch bitcoin futures this year.
"This letter is to request [the CFTC] require any clearing organization that wishes to clear any cryptocurrency or derivative do so in a separate clearing system isolated from other products," Peterffy wrote.
)
)
)
The CFTC, the financial watchdog overseeing futures and derivatives markets, would be the agency responsible for approving and regulating bitcoin futures. CME announced in October they would launch such a product by the end of the year. And earlier this month, Terry Duffy, the head of CME, said a bitcoin futures product would likely be ready by the second week of December
"We would not overstate this, as a material reduction in volatility would require there to be a large community of speculators prepared to provide liquidity to the natural owners of the various coins, but given the volatility of the coin markets, maybe there already exists a cadre of participants who would look to short coins on strong days and vice versa, which could overall reduce volatility."
Peterffy's outlook is less optimistic. He said bitcoin futures could ultimately "destabilize the real economy" unless they are isolated.