Nasdaq plows ahead to launch bitcoin futures despite cryptocurrencies' bear market

Key Points
  • The world's second-largest stock exchange is teaming with VanEck to launch bitcoin futures.
  • Nasdaq's product joins a growing list of bitcoin derivatives coming to the market in the first quarter of 2019.
  • Nasdaq will provide "a regulated crypto 2.0 futures-type contract" to investors, VanEck's director of digital asset strategy said on stage this week.
Scott Mlyn | CNBC

The Nasdaq is moving ahead with plans to launch bitcoin futures as early as next year, despite an ongoing bear market for crypto.

The world's second-largest stock exchange is partnering with VanEck to launch cryptocurrency products, including derivatives, according to a representative from the investment management firm.

Gabor Gurbacs, VanEck's director of digital asset strategy, confirmed previous reports of the bitcoin product during the "Consensus: Invest" conference in Manhattan on Tuesday. The companies will bring "a regulated crypto 2.0 futures-type contract" to investors, Gurbacs said during a panel discussion.

Nasdaq won't be the only one in the bitcoin futures arena — rival New York Stock Exchange's owner Intercontinental Exchange is rolling out its own contracts and said last week they will go live in late January.

So far, the Commodity Futures Trading Commission, which regulates bitcoin, has approved two crypto futures products — one from the Chicago Board Options Exchange and another by the Chicago Mercantile Exchange. This week, those derivatives contracts hit their lowest level since they were introduced in December.

VanEck's Gurbacs said the firm "ran a few extra miles working with the CFTC to bring about new standards for custody and surveillance."

Those are two of the issues that Securities and Exchange Commission Chairman Jay Clayton said this week need to be resolved before he would feel "comfortable" allowing a crypto exchange traded fund, or ETF, to come to market.


VanEck has separately been vying for approval of what would be the first-ever bitcoin ETF. The SEC has turned down multiple other applications, including one by brothers Cameron Winklevoss and Tyler Winklevoss, citing risks of market manipulation and investor protection.

The U.S. financial watchdog has yet to approve one. It published a letter in January pointing to "significant investor protection issues that need to be examined" before sponsors can offer these funds to retail investors.

Bitcoin itself is struggling to find a bottom this week. The world's largest cryptocurrency rose 13 percent, back above the $4,000 level after hitting a 14-month low on Sunday. Bitcoin is down more than 75 percent since its all-time high near $20,000 in December, according to data from CoinDesk.

Nasdaq CEO Adena Friedman told CNBC in April that the exchange was closely watching the cryptocurrency sector. Once it matures, she said, the Nasdaq is open to becoming a platform for trading cryptocurrencies such as bitcoin.

"Certainly Nasdaq would consider becoming a crypto exchange over time," Friedman told CNBC's "Squawk Box" in April. "If we do look at it and say 'it's time, people are ready for a more regulated market,' for something that provides a fair experience for investors."

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