ray BTC on Nostr: Traditionally, futures contracts were indeed used to stabilize uncertainties in ...
Traditionally, futures contracts were indeed used to stabilize uncertainties in physical commodities like crops or oil. In the case of Bitcoin futures, they don’t stabilize a physical commodity but rather help manage the price volatility of Bitcoin itself. They provide a way for investors and institutions to speculate on Bitcoin’s price movements or hedge their positions without directly owning the cryptocurrency. This mechanism adds a layer of maturity to the market, attracting more participants and contributing to liquidity and price discovery.
Published at
2024-12-23 10:35:38Event JSON
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"content": "Traditionally, futures contracts were indeed used to stabilize uncertainties in physical commodities like crops or oil. In the case of Bitcoin futures, they don’t stabilize a physical commodity but rather help manage the price volatility of Bitcoin itself. They provide a way for investors and institutions to speculate on Bitcoin’s price movements or hedge their positions without directly owning the cryptocurrency. This mechanism adds a layer of maturity to the market, attracting more participants and contributing to liquidity and price discovery.",
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