Quote from: Jet Cash on December 08, 2017, 06:16:02 PM

Quote from: superlative on December 08, 2017, 06:11:15 PM

This is how I think futures affects the price. Someone please correct me if I'm wrong.

Say in November bitcoin is $8k, and Bob bets that in 1 month time that the price will be $10k. John agrees to the futures and to sell bitcoin at $10k to Bob in Dec.

In December, the bitcoin price is actually $15k. Now Bob gets a $5k discount, and John loses $5k - plus a whole bunch of bitcoin is sold at $10k when the price is $15k.

Does the whole market react and then tank because a whole amount of bitcoin was sold at $10k??

That would be correct if it required physicl delivery, but this is a cash settlement system, so no Bitcoins are involved.

thank-you for correcting me. If that's the case, then some people are going to make and lose US$. How does that affect the bitcoin price? I don't get it. To me they are two different universes. It's like if we had a telescope to see the activities of people in another planet, we could bet on futures on their activities and make/lose money - but that doesn't affect their ecosystem.

How would US$ based futures affect bitcoin? I don't get it.