Bank of America Approves Bitcoin Futures Trading for Some Clients: Sources
America’s second-largest bank, Bank of America, has approved the trading of bitcoin futures for some clients, according to two people with knowledge of the matter who spoke on condition of anonymity.
Like most institutions, the U.S. bank has been conservative in its approach to the crypto sector, but due to the large amount of margin required to trade the futures, it is now allowing some clients to access this market, one of the sources added. Some clients are in the process of setting up to trade bitcoin futures, and one or two may have already gone live, the other source said.
A number of investment banks are reportedly allowing clients to invest in crypto products. Goldman Sachs confirmed plans to relaunch its cryptocurrency trading desk after a three-year hiatus. In May, Goldman Sachs started buying and selling bitcoin futures in block trades through Chicago Mercantile Exchange (CME) Group, using Cumberland DRW as its trading partner.
Bank of America will also be using CME futures, according to one of the sources.
Bank of America didn’t respond to CoinDesk’s questions by press time.
Earlier this month it emerged that the Charlotte, N.C.-based bank had created a team dedicated to researching cryptocurrencies and related technologies. Back in 2018, Bank of America blocked financial advisers and clients from trading in bitcoin-related investments but this has now changed.
CME bitcoin futures were first launched in 2017. In May, the CME launched its “Micro Bitcoin” futures products in an attempt to capitalize on bitcoin’s price rally.
Earlier this year, CME took the prime spot on the list of the biggest bitcoin futures trading platforms, indicating a continued rise in institutional participation.
The total open interest in the bitcoin futures market is sitting at $11.3 billion, down 59% from its April 13 peak of $27.3 billion, according to Arcane Research.Source