Last year, a large gathering of crypto's was product. Chicago Options Exchange Board (CBOE) would launch futures on Bitcoin
They were announced as a merger of crypto investment space and traditional spheres. Now, those on Wall Street could enter the Bitcoin space with a familiar product.
A few months after the launch of futures, it is probably the right time to check and see how this product worked. Dennis O 'Callahan, director of product development at CBOE, recently spoke with Cointelegraph at the QUANT conference in Venice about the events that have been going on for the past few months since the futures contracts were available through CBOE.
Cointelegraph: Hi Dennis, thank you for taking the time. Let's start from the beginning, what made you decide to pursue Bitcoin futures as a potential product for CBOE?
Dennis O. Callahan: I am in product at CBOE, so my only role in this business is to develop products and put products on the market. We are monitoring all spaces, including the cryptocurrency space, and we have been looking at it since about 2014, looking for ways to get involved in this market. We looked at the Blockchain itself, and the crypto-currencies themselves, so we were looking for a long time, but we have never found a way that suited us until last year in March, when we examined this particular design.
CT: You were not the only ones out with Bitcoin futures in December, but you were the first, how did you start a similar project? Have you kept an eye on their product?
DO: We had been talking to our regulators, the CFTC, since May or June 2017. So we have been in the process for quite some time. In August, we issued a press release saying that we were exploring this market and that at the time we had still not heard of other stock exchanges involved in this market we were on the right way to have this product before even hearing CME was looking at this space. We were first on the market because we had been working on it for a while. We are satisfied with the way our product works and we are very comfortable with that, but we are watching the competition. Still, we are satisfied with the product design.
Regulations and Media Hype
CT: What about the regulatory minefield often associated with crypto-currencies, how did it negotiate the rules ?
A: The CFTC wants the same things we want, we want a fair and orderly market, and we want a market that is not open to the manipulation or something untoward. They asked us questions, very good and insightful, they challenged us on points and we answered their questions. It was a process but we are very comfortable with their market knowledge. It probably took longer than most products that we can simply certify and launch, we went to them to make sure they were comfortable with the product before we were determined to launch it. massive hype leading to the launch of futures, have they matched that now, and, are you happy with the product, would you consider it a success?
DO: We have seen a lot of interest, especially the retail interest, by some retail companies. We negotiate close to 7,000 contracts a day, so we are very happy with the progress of this product. We love what we have done, and we are pleased with the progress made by the product.
Our goal is to make sure we do everything we can to make the product as accessible to users as possible. We believe we are moving in that direction, so we are pleased with the results so far.
Tracking Other Markets
CT: As Product Development Manager, what else did you draw your attention to the market for? cryptocurrency and the different products that exist. Is there an intimate scoop that you can give us about what CBOE has in the eye?
DO: Being in product development, our task is to search for new products all the time. So we are constantly evaluating this market, and we are also evaluating other cryptocurrencies, among others. But we have seen how Bitcoin has worked, so we certainly monitor other markets to make sure that the infrastructure and everything is in place in case we want to pursue other cryptocurrencies.