It has been a little over a week since bitcoin futures began trading, with Cboe World Markets' product available as of Dec. 10 and CME Group Inc.'s (CME) bitcoin futures trading as of Dec. 18. Since then, TradeStation, one of the few online brokerages to give customers access to the investment products, has seen brisk trading in the futures contracts.
According to TradeStation, for the first week of bitcoin futures trading, 8,800 underlying coins were traded on the company's platform through Monday, Dec. 18, which represents $165 million in value. Meanwhile, Nick LaMaina, the firm's senior vice president for brokerage services, told CBS last week that around half of the bitcoin futures traded on TradeStation are short sales.
Heading into the launch, TradeStation said that it was seeing demand and that it would be ready on day one to provide its clients access to the products. In a video interview, James Putra, director of innovation and strategy at TradeStation, said that the online brokerage has seen a "lot of excitement" both for cryptocurrencies and the futures products from lots of investors "thirsty for information."
Given the difficulty in finding good information on cryptocurrency, Putra said that TradeStation is trying to become a place where investors can go for everything related to cryptocurrency. He pointed to videos, webcasts and data on the firm's website that are designed to help investors make an informed decision about bitcoin. "The excitement has outpaced where we currently are with the technology," said Putra. "It's still very very new. It's important to take the time to learn what it is before you put your capital at risk."
At the same time that TradeStation is embracing bitcoin futures, some of its rivals are taking a wait-and-see approach. Charles Schwab spokeswoman Kaitlyn Downing told Investopedia that the firm is waiting to see how the market develops before jumping on the cryptocurrency bandwagon. "While Charles Schwab is not currently engaged in cryptocurrency trading, we are monitoring this new market and evaluating our clients' interest levels and familiarity with cryptocurrencies, along with their dynamics and risks. We intend to study the new proposed bitcoin futures contracts and weigh their associated risks with an eye to protecting our clients' interests before we make these products available."
Meanwhile, Ally Invest did an about-face, saying that it will hold off on offering CME's bitcoin futures despite proclaiming in the past it was on board with both bitcoin futures products. "After monitoring the activities of the past week and conducting further analysis of the level of controls and requirements for this product, we have decided not to offer it at launch. Instead, we will closely watch the bitcoin futures market as it develops and continue to evaluate the offering for our clients," Ally Invest said in a statement to online publication Bank Innovation.