TD Ameritrade: Bitcoin Futures Trading Stabilized in January With Its Price

Bitcoin futures got a lot of attention out of the gate, with investors signing up to the few online brokerages that are offering the products to get in on the action. But with the price of bitcoin stabilizing in January, so is trading in the bitcoin futures launched by CME and CBOE World Markets.

That's according to TD Ameritrade Chief Executive Tim Hockey, who said in an interview with Business Insider that there is a direct correlation between the price of bitcoin and how the futures trade. "This market is certainly not mature. I would say that what we saw in terms of levels of absolute interest prior to the holiday season seemed to peak. Everybody was talking about crypto of all types all the time because it seemed like it was a one-way increase," he said in the interview. "Ever since the pricing has been normalized and there's been a bit of a correction, then you've seen a little bit less froth, if you will, in the market."
Hockey said that, in the first few weeks of January trading, cryptocurrency trades – not just the futures contracts but also companies that are linked to blockchain – have contributed a couple of points less to trading activity at TD Ameritrade Holding Corporation (AMTD). "It seems to have peaked just before the holidays," the CEO told Business Insider.

In December, CBOE and CME announced plans to launch bitcoin futures products. The new products were quickly adopted by a handful of online brokerages, including TD Ameritrade, E*TRADE and TradeStation. The other online brokerages have been taking a wait-and-see approach, citing the volatility associated with cryptocurrencies, including the bitcoin futures.

To say that bitcoin is volatile would be an understatement. The cryptocurrency started 2017 valued at around $1,000 and shot up to a high of more than $19,000 at one point in the year. Bitcoin has more recently come back to earth, currently valued at $11,040. Companies have been jumping on the bandwagon, announcing blockchain plans or adding blockchain to their names. That has resulted in their stocks surging, similar to what happened during the dotcom boom. Blockchain is the technology that enables cryptocurrencies to be possible.
"There's a distinction between blockchain and cryptocurrencies, but they are absolutely being conflated in many people's minds," Hockey said in the Business Insider report. "The technology certainly has not matured, and I believe the transformative nature of what blockchain can do is only just starting to be understood by the majority of the world."