International rating Agency Moody’s announced that he does not consider the possible impact of the launch of futures on the bitcoin to credit rating exchanges CME or CBOE.
Almost two months after exchange CME and CBOE had introduced lists of new derivatives on bitcoin, Moody’s published an 11-page report, which argues that a combination of risk management from both companies, as well as the state of the cryptocurrency market, reduces the potential risks:
«At the moment, the volume of futures on bitcoin is small, but CME and CBOE hope to arouse in the investor community interest in this asset. The price of bitcoin has high volatility, but we do not believe that this market could materially affect the credit rating of CME or CBOE due to smaller volumes and a robust system of risk management in the clearing (CCP)».
The report presents an overview of the formation of the futures market, and examines the most pressing, according to Moody’s, the problems, which include the volatility of bitcoin prices. The authors of the document argue that setting a high margin limits for trades with futures exchanges bitcoin helps to reduce the risks.
«The volatility of Bitcoin prices is a problem for risk management systems in clearing centres, complicating the process of elimination of applications that do not abide by requirements of clearing participants,» writes the company, «to handle the risk and CME, CBOE set a relatively high margin limitations compared to initially presented to the regulators. At the moment, low volumes also limit the potential losses of the Central counterparties».
This also applies to the brokers, providing access to futures on bitcoin, says Moody’s – even if the end is not clear how the margin limits will be set in the future. In particular, the report refers to brokers TD Ameritrade and E*Trade.
«Clearing margin will remain in motion and can quickly and greatly to rise in response to the high volatility of bitcoin prices, so brokers will have to make changes.»