HomeBusinessCoinbase Shares Drop 9% on CME Report to Consider Listing Spot Bitcoin

Coinbase Shares Drop 9% on CME Report to Consider Listing Spot Bitcoin

  • Shares of Coinbase fell nearly 8% to a price of $202.49 on Thursday.

  • The drop came after a report from the Financial Times that futures exchange CME was considering offering spot bitcoin trading to its customers.

Shares of Coinbase fell nearly 8% to $202.49 during the morning hours in the US on Thursday after a Financial Times reported that the Chicago Mercantile Exchange (CME) could soon offer spot bitcoin trading with strong customer interest.

Cryptocurrencies were on the rise that day. The CoinDesk 20 Index, which tracks 20 of the largest digital tokens by market cap, is up 0.91% over the past 24 hours. Bitcoin {{BTC}} rose half a percent as it continued to benefit from Wednesday better than expected inflation report. COIN is up 29% this year as crypto 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 benefited greatly from being the most trusted crypto exchange in the US, but that advantage could change if CME comes into play.

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The CME has passed designated by US regulators as a ‘systemically important financial market tool’, a designation that implies that it is subject to stricter supervision. Many investors also assume that the designation implies that the government would never allow the CME to fail in the event of financial duress.

CME is already the largest bitcoin futures exchange by open interest in the US

The exchange said it has held meetings with traders who want to trade bitcoin on a regulated marketplace, people familiar with the matter told the Financial Times.

A common reason for traders to avoid using digital assets is the lack of trust in crypto exchanges, especially after a series of bad actors have been exposed in recent years, including the once-popular crypto exchange. FTX.

Recently launched spot bitcoin exchange-traded funds (ETFs) gave traders a safer way to invest in the token, benefiting more than 500 institutions in its first three months of existence, investing more than $10 billion to be allocated. The rest, more than $40 billion, came from retailers.

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