Ethereum Futures went live on the CME today. This event has many people worried since 2017 when Bitcoin Futures launched on the CME, the price of Bitcoin dropped from its previous all-time high of $20,000 and went down by 70% in less than six weeks. The launch of the Bitcoin CME futures coincided with the end of the bull run and the beginning of a long, sad bear market, leaving people to speculate whether this could be the beginning of the next bear market.
The CME is the biggest Futures market globally, and today they launched their Ethereum Futures. It will provide a wide range of market participants with a new and easy way to get exposure to the price of Ethereum; they can bet on the price over on the CME Futures market.
The launch of these Futures comes just a few days after Ethereum hit its new all-time high of $1,752. Since the announcement of the Ethereum CME Futures launch, Ethereum has been on a bullish spree.
The CME Futures are paper products; they are paper derivatives; no Ethereum is backing these paper contracts; they are all settled in cash. In terms of actual market impact, the CME could do a hundred billion dollars, and not a single real piece of Ethereum will be bought or sold. It is only a derivative trading platform, unlike Grayscale that bought Ethereum and put it in their vaults to back up their shares.
Some people think this will be a terrible event like it was for Bitcoin like it was in 2017, and some people think otherwise since it is just paper contracts and there are those who believe this will be good based on price appreciation because we will see more institutions getting exposure to the asset and taking an interest in the asset
Some people still have some PTSD issues surrounding the topic of crypto currency CME Futures launches and that has led some people to think that the Ethereum CME Futures are going to end up the exact same way the Bitcoin CME Futures did. But the thing is that, all that happened back in 2017, things are not how they used to be, everything is different now.
The current market structure is different, the market is moving up a lot and it is nothing like 2017. We are now in the early stages of a bull market not the last stages of a bull market like how it was in 2017. This market has a long way to go. The Bitcoin CME futures launch might not have been what caused the dump, it might have only been a coincidence.
