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Jamal Bouoiyour and Refk Selmi
''How do futures contracts affect Bitcoin prices ?''
( 2019, Vol. 39 No.2 )
Bitcoin futures were launched by the Chicago Board of Options Exchange and the Chicago Mercantile Exchange group on December 18th, 2017. This study stands as a first attempt to explore the reactions of Bitcoin spot market to the launch of futures contracts. Using an event-study methodology and an adjusted asset pricing model, we show that Futures trading drove up the price of Bitcoin immediately after the announcement day. This reaction started to decrease noticeably following the launch of the futures contracts. Such outcome seems in line with the trading behavior that typically accompanies the launch of futures markets for an asset.
Keywords: The lunch of Bitcoin futures, Bitcoin prices, improved event-study methodology.
JEL: F3 - International Finance: General
E3 - Prices, Business Fluctuations, and Cycles: General (includes Measurement and Data)
Manuscript Received : Mar 02 2019 Manuscript Accepted : May 15 2019

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