U.S. bitcoin futures on Thursday closed below $17,000 on a fourth full day of trading, while the spot price for the cryptocurrency moved higher.
Bitcoin futures expiring in January XBTF8, +6.67% which hit as high as $17,520, settled at $16,800, according to Cboe Global Markets Inc., a decline of 1.5% compared with Wednesday’s settlement of $17,055.
Spot prices for bitcoin BTCUSD, +5.04% were at $16,567, a 1% gain, according to data from CoinDesk. The No. 1 digital currency tumbled briefly below $16,000 late Wednesday before rebounding to push back above $16,500.
Futures trading for bitcoin has settled down since Sunday’s launch by the Cboe, which kicked off at $15,000 for the January contract. Based on that starting level, the futures contract is up about 12%. Cboe rival CME Group Inc. CME, -0.78% will begin its own bitcoin futures trading on Monday.
Bitcoin’s massive gains this year — up about 1,600% — have triggered huge interest in digital currencies and the companies that mine them. A fear-of-missing-out attitude has driven more money into cryptocurrencies, while on the other side there have been bubble warnings and advice for investors to proceed cautiously.
Yellen on bitcoin: Outgoing Federal Reserve Chairwoman Janet Yellen referred to bitcoin as a “highly speculative asset,” speaking at a press conference after the central bank raised its key interest rate on Wednesday. She said the digital currency has a “very small role” in the payment system, as it has no stable store of value nor is it legal tender.
“The Fed doesn’t really play any role, any regulatory role with respect to bitcoin, other than assuring that banking organizations that we do supervise are attentive that they are appropriately managing any interactions they have with participants in that market, and appropriately monitoring anti-money-laundering Bank Secrecy Act responsibilities that they have,” Yellen said.
ICO explosion in 2017: Another popular means of trying to cash in on the cryptocurrency excitement this year has been initial coin offerings, or ICOs — a fundraising method aimed at attracting investors looking for the next big crypto score, but without the regulatory hurdles.
Fresh data from Autonomous Research has found that this year ICO fundraising topped $4 billion for the first time, a huge leap from $225 million in 2016.
Securities and Exchange Commission Chairman Jay Clayton offered his own warning to investors over cryptocurrencies and ICOs earlier this week, a day after the Wall Street regulator shut down a $15 million ICO.
“Your invested funds may quickly travel overseas without your knowledge. As a result, risks can be amplified, including the risk that market regulators, such as the SEC, may not be able to effectively pursue bad actors or recover funds,” said Clayton.
Read: What’s an ICO? (Or: Why Dilbert’s boss should read MarketWatch)
Read: 4 tips on protecting your money from bubbles — even if you’re holding bitcoin