Why Are Bitcoin Futures Trading for Higher Prices than Bitcoin Itself?

in #bitcoin7 years ago

In an efficient market, prices in the futures and spot markets tend to converge. Bitcoin futures, however, are trading at a more than 10% premium compared to prices in the spot market.

Arbitrage opportunities

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In an efficient market, arbitrageurs spot price differences and make contra-trades in both markets, netting a profit without taking any risk. In this case, arbitrage traders can sell Bitcoin futures and buy Bitcoins in the spot market, locking in a profit irrespective of the way Bitcoin's price moves.