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The uniqueness of bitcoin futures makes it vulnerable to price manipulation

This month, two large companies, CME and Cboe, planned to launch bitcoin futures . In a recent interview, the CFTC, the major regulator of the relevant industries, said that it fears that there will be price controls.

Bitcoin futures are not the same as other commodities

Andrew Busch, CFTC regulator's chief market intelligence chief, said the futures market is about to "have a very exciting moment."

The CFTC is the primary regulator of industry contracts and they are looking to include cryptocurrencies in their policy systems.

Busch said:

The most important thing I think is that people need to understand how the new contract is generated, whether the contract was launched by the CME or another exchange, and that there are two steps that need to be completed: the process of self-certification followed by the process of written approval.
The CFTC's initial stance on Bitcoin was also conservative as industry giants such as Interactive Brokers opposed the move , with chairman Thomas Peterffy warning the market that the Bitcoin contract is highly recommended to be separated from other products.

Busch states:

We are also involved, observing developments, because Bitcoin is so special. The chairman of the CFTC said that bitcoin is a unique animal, different from the other products we have known before.


Busch admits:

We participated in the whole process early in the bitcoin futures program. We constantly change the contract content, but also encourage them to make reasonable changes. The margin stipulated in the contract is much higher than the plan they initially proposed.
Reporter interrupted him:

Will bitcoin futures contracts become more secure?
He replied:

What we want to convey is that the exchange is responsible for studying the underlying cash contracts and they should ensure that there is no manipulation in them. And we, as derivatives regulators, should ensure that contract futures are not manipulated. This is what we must do. We will continue to work with exchanges to ensure there is no manipulation of bitcoin in exchange.

He stressed:

People in the study of bitcoin to know: the current capital market has not yet been regulated. I think investors planning to invest bitcoin and other currencies should keep this in mind at all times.
He was also asked about the risk of trading commodities in an unregulated market and in a market that has been heavily regulated.

Of course, this is a new area of ​​investment. The biggest challenge for all inside the CFTC is price volatility.
He pointed out that other products in the same industry also have volatility:

We have already undergone stress tests. I think the exchange has been able to deal with this new type of assets.
The regulators are in a really awkward position to defend Bitcoin, but in fact he has done quite well in the rest of the year. The reasonable range of margin, market mechanisms such as bitcoin Bitcoin hedge funds and arbitrage opportunities all contribute to the maturity of this "unique animal."