Largest brokerage firm Interactive Brokers will allow their customers to open short positions in futures on bitcoin, or speaking in the slang of traders to short sell.
According to the chief Executive officer, Interactive Brokers Thomas Peterfi (Thomas Peterffy), the tool will be available by the end of this week. Before that, traders were available only long positions.
On the first day after the launch of the CBOE, the share of Interactive Brokers accounted for more than half of the trading volume in futures on bitcoin. According to analysts, the opportunity to play on the slide can affect the balance of trading on the exchange.
To reduce their own risks Interactive Brokers will require from those who want to use short positions to Deposit five times more value of their futures contracts to cover possible losses, due to the fact that short positions are more expensive than long.
However, Peterfi expressed doubts about the feasibility of opening short positions by traders:
«I think it’s suicide to sell the contracts… How much will the bitcoin, no one knows.»
To accommodate long items through Interactive, traders need to put 50% of the contract value as margin. On 12 December on the stock exchange the CBOE futures for January were sold at a price of $18 020 for the contract. This means that to open the trade the trader’s Deposit must be over $9,000 on each contract, including the Commission of the exchange.
Peterfi suggested that given the risks associated with uncovered sales, at current prices the margin on one position on the CBOE should be around $100 thousand. On the CME, where the contracts will be five times larger, the margin for short positions would be around $500 thousand.
In CME, in turn, said that raising margins on futures on bitcoin, which will be launched on 18 December, to 43%. Earlier it was reported that she will be 35%.