Monday, December 11, 2017

Bitcoin debut trading on CBOE and I have to be careful.

Bitcoin debut trading on CBOE and I have to be careful. Bitcoin ($XBT) is now traded on CBOE on Sunday night. As of Monday morning, $XBT surged as much as 25% to $18,850 during their debut session triggering two temporary trading halts. CBOE has installed a trading halt rule of 10% anticipating volatility of the world most popular cryptocurrency. Trading volume has been thin. About 2,700 contracts for January changed hands. Considering, many brokers cast margin limitation and short selling limitation for this future contract, this trading volume does mean certain popularity and interests from the market.

I do not trade or mine Bitcoin or other cryptocurrency. I have to say I don't know too much about it despite that I understand most of the technologies it deploys. However, evaluating Bitcoin is something of a mystery. This is not for me as an investment asset. Even if I trade Bitcoin or other cryptocurrencies, it's going to be very small amount.

However, I am concern about its impact to the market should the price of the Bitcoin turn south drastically. I do invest in Semiconductor Index ($SOXX). The semi index has been up much for the last 12 months. The market rising interest of Bitcoin is part of the reason for the index. I doubt the percentage of the CPU, GPU and memory business due to bitcoin mining is significant to the overall industry. However, psychologically a drastic drop of the currency may invite speculation for the asset as well as the related industries.

I'll keep a close eyes on it for my own investment.