Betting Against Bitcoin: Hedge Funds are Targeting Price Falls

Hedge funds are rapidly expanding into the crypto market with announcements from CME Group Inc., Cboe Global Markets Inc., and Nasdaq Inc., elevating cryptocurrencies into an emerging asset class. These hedge funds have passively watched the cryptocurrency system buildup over time with incentive markers in the price index volatility and steady comparative variations among altcoins and cryptocurrencies. Now, this high-risk venture will take its chances with Bitcoin Futures services provided by the aforementioned once Chicago Mercantile Exchange’s futures market open, targeting price-falls of cryptocurrencies to maximize investment returns.

A business professor at the University of Houston, Craig Pirron, opined that “having this instrument that makes it easier to short might keep the bitcoin price a little closer to reality as the futures reduce the frictions of going short more than they do of going long, so it’s probably net bearish.”

Since its creation in 2009, Bitcoin has grown exponentially. Early investors who invested in the digital currency have reaped over 50,000% ROI. Comparatively, investment of the same amount in the S&P 500 stock index, with reinvested dividends inclusive would not yield as much. The gap between the two investment is shockingly outrageous.

“One of the greatest shorting opportunities ever”, declared Lou Kerner, partner at Flight VC, “…it’s the greatest thing to ever happen in the history of mankind.”

The recent volatility in bitcoin prices has shown sporadic increases by a factor of 72% with a sharp dip of 20% in the month of November after topping $11,000 USD within a 90-minute window. The price has long recovered and has steadily increased to trading above $11,332.01.