Futures & Options on Bitcoin: Why It Won't Work...
Just to clarify: it won't work now without significant attention from the right people. Bitcoin would stand to benefit from some type of options or futures market, as these instruments help people mitigate their risk in other assets when used properly (yes, I'm looking at you, Dick Fuld ). Currently the only way you can protect yourself from losses in BTC is to sell at the right time, and everyone knows timing any market is very hard to do. (Well, not so hard---just sell next time someone hacks the system, as it starts falling, then buy again in about 24 hours. It's tricky to actually pull off, though, when currently one exchange handles most of the transactions and basically falls apart during high volume.) Apparently, due to the denial of service attacks on Mt. Gox, the most popular Bitcoin exchange, within the past few weeks, folks have been looking to create an open-source trading platform that will allow anyone to make their own BTC exchange with all the be...