Subsequently, the followers of crypto think that financial firms negotiate bitcoin like bonds, stocks, gold etc. Besides, trading involves volumes and scrutiny that most crypto exchanges are not ready to manage. However, Bitcoin exchanges face costly technology upgrades or degrade as the increase in activity.
At present, several Bitcoin platforms are exceeding their limit within the cryptocurrency elation. According to an expert, the systems upgrades are proceeding as best practices in the field are far from consistent.
Bank of America Merrill Lynch analyst wrote,
“Institutional investors would welcome overall a more sophisticated exchange presence. Although there are many trading platforms, by and large, these do not offer the same quality of technology as the large global exchange groups”.
Furthermore, bitcoin startups couldn’t front the price tags. Although, the conversations between crypto platforms and sellers of matching engines designed for exchange industry have taken place. Since the system prices may vary from $500,000 to $10 million a year on the bases of exchange size.
The big Chicago exchange operators: Cboe Holdings and CME Groups are in plan to launch bitcoin futures. Since they develop their own trading platforms.
The president of Cboe Europe, Mark Hemsley said,
“It’s not the size of trades that cause problems for an exchange—it’s usually the volume”.
The trading volumes
However, Bitcoin trading volumes are growing rapidly. According to Coinmarketcap.com, Bitcoin averages about $1 billion to $5 billion in trading across all exchanges per day.
Recently, Bitcoin price had risen above $7000 while CME Group declares its bitcoin futures. The Cboe offering bitcoin futures that allow traders to stake on the price assets at several dates in the futures.
Meanwhile, head of GDAX, Adam White says, by-products will go well for the whole industry. Along with regulated cryptoassets exchanges like Gemini and GDAX the main benefits from up surging bitcoin volumes.
Gemini said on its blog,
“This is not the first scaling challenge we’ve encountered, and it won’t be the last. We’re continuing to improve our performance and infrastructure monitoring so we can anticipate potential problems more quickly in the future”.
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Increasingly, if Cboe and CME’s futures gain approval, it makes easy for major institutions to trade Bitcoin derivatives.
Cboe’s Hemsley says,
“This could be a market where the futures market is bigger than the underlying market”.
Particularly, the future contracts will be settled in cash. It means while investor pays in dollars instead of Bitcoin. Thus, it prevents heavy regulated firms to get involved in cryptoassets.