April 21, 2024

Former CFTC CEO: we deliberately burst the Bitcoin bubble in 2017

Christopher Giancarlo explained how the US government influenced the sharp decline in the cost of firstcryptocurrencies.

CFTC, US Treasury, SEC and former directorNational Economic Council Gary Cohn specifically approved the launch of Bitcoin futures to “burst the bubble of the first cryptocurrency,” said Christopher Giancarlo, former head of the Commodity Futures Trading Commission. He explained how the U.S. government influenced the value of the main digital coin at the end of 2017, CoinDesk writes.

“We saw the bubble grow, and decided thatthe best way to eliminate it would be to provide the market with tools to interact with it. If you think that the price is too high, but do not have the means to express your views, if you do not have a derivative, then only supporters remain, and this is their market, ”Giancarlo explained.

According to him, with the launch of futures onthe regulated market has the opportunity to open short positions. The head of the CFTC added that the Bitcoin financial bubble is directly related to the 2008 crisis, because at that moment the regulators did not react properly and did not “burst the mortgage bubble while they had such an opportunity.”

Giancarlo explained that from this experienceregulators learned to act quickly while Bitcoin was rising in price. Futures for the first cryptocurrency were launched the day after it set a historical maximum value of $ 20,000. Then, in the coming weeks, it decreased many times.

“I consider this a demonstration of the strength of the market in restoring order with prices,” Giancarlo concluded.

Chicago Mercantile Exchange (CME) and Chicago Options Exchange (CBOE) Bitcoin futures were launched on December 18, 2017. Since then, the cost of the main digital coin has dropped by 60%.