Anonymous News: U.S. Banks Launch Bitcoin Futures Trading Service
An anonymous source revealed that Bank of America has become the latest Wall Street institution to enter the Bitcoin futures market, offering users cash-settled Bitcoin futures trading through the CME.
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According to sources cited by CoinDesk, due to the large amount of margin required for futures trading, banks have been relatively conservative in developing such businesses. The futures contracts introduced by Bank of America are settled in cash rather than physical bitcoins.
One of the sources stated that some Bank of America clients are getting ready to enter the futures market, with one or two possibly already engaging in futures trading. However, Bank of America has not officially responded to this news.
Despite the cooling of the cryptocurrency market since the beginning of the year, Bank of America's entry indicates a warming trend of the crypto industry on Wall Street. Previous reports have indicated that several traditional financial institutions have initiated cryptocurrency trading businesses this year.
Goldman Sachs is reported to be restarting bitcoin futures trading; crypto venture firm Galaxy Digital has launched an Ethereum fund; and Morgan Stanley, through partnerships with New York Digital Investment Group (NYDIG) and digital asset investment company FS Investments, is offering products linked to bitcoin to some high-net-worth clients.
In mid-March this year, Bank of America strategists raised several concerns about bitcoin in a report, including:
- Concentration of chips
- Price correlation with stocks
- High price volatility
- Threat of CBDCs
- Poor ESG scores
- High correlation with commodity and other asset classes
They believed that its price is easily manipulated, estimating that "only a net inflow of $93 million could drive bitcoin up by 1%," and pointed out that DeFi is more disruptive than bitcoin, yet they have decided to expand into bitcoin futures trading.