Bitcoin
Coinbase (COIN) Shares Sink 9% on CME Report to Consider Spot Bitcoin Listing
Coinbase shares fell nearly 8% to $202.49 during U.S. Thursday morning following a Financial Times report that the Chicago Mercantile Exchange (CME) may soon offer bitcoin spot trading amid strong customer interest.
Cryptocurrencies were on the rise that day. O CoinDesk 20 Index, which tracks 20 of the largest digital tokens by market cap, is 0.91% higher over the last 24 hours. Bitcoin (BTC) rose half a percent as it continued to profit from Wednesday’s profit better than expected inflation report. COIN is up 29% year-to-date as cryptocurrency prices have risen since the start of the year.
Chicago-based CME, with a history dating back more than a century, is the world’s largest futures exchange and a financial powerhouse. Until recently, Coinbase profited heavily from being the most trusted cryptocurrency exchange in the US, but that advantage could change if CME takes action.
The CME was designated by US regulators as a “systemically important financial market utility,” a designation that implies it is subject to stricter oversight. Many investors also assume that the designation implies that the government would never allow CME to fail in the event of financial difficulties.
CME is already the largest bitcoin futures exchange by open interest in the US
The exchange said it has been holding meetings with traders who want to trade bitcoin on a regulated market, people familiar with the matter told the Financial Times.
A common reason for traders not wanting to touch digital assets is a lack of trust in cryptocurrency exchanges, especially after a series of bad players were revealed in recent years, including the once highly popular cryptocurrency exchange. FTX.
The recently launched spot Bitcoin exchange-traded funds (ETFs) have given traders a safer way to invest in the token, which more than 500 institutions have taken advantage of in just its first three months of existence, allocating more than $10 billion to the funds alone . The rest, more than $40 billion, came from retail traders.