🔰Bitcoin Futures and it's role in layman terms.

                         Last year we witnessed the launch of Bitcoin Futures in early December and after that the price of Bitcoin just skyrocketed in the shorterm near the mid of january this year and is currently trading at around $6500. But have you ever wondered why the launch of Bitcoin Future affected and will affect Bitcoin in future, that what we will find out in this aricle. But first thing first, for those of you guys doesn't have the slightest clue on like "what futures are" and the "WTF" thing poping inside of you head, let me start off by giving an introduction on Futures.

                         Consider Joe, he is a gas station owner. One day on the news he heard something about the passing of a bill regarding gas. After hearing the news he anticipated that within a month the price of gas may fall up to 20% due to the bill. So he decided to take advantage of the situation and thereby he sold all his reserved gas of around 2000 barrel at $100/ barrel today to someone willing to buy. Later that month to his anticipation the price of gas dropped as much as 22% and with the money, he got from selling his gas reserve, Joe bought back the gas at $80 / barrel, thereby making a profit of around $40 k in the process.

                         This is called hedging and you may also find this very familiar, as this is what most of us do when trading crypto to secure our portfolio, when we sell Bitcoin for Tether and then back buy more Bitcoin for the same amount of Tether we earned by selling our bitcoins.
                         When both parties enter into an agreement to buy or sell physical assets like the one above at a fixed and certain price at a future date, the agreement is called a Future.Remember that, in Futures one can either go long( fancy term for saying you will buy) or go short ( fancy term for saying you will sell).

                         Similar to Futures backing physical assets, Futures can also be created based on the price of Bitcoin, and these are called Bitcoin Futures.Bitcoin Futures are a means to hedge and work similarly as the mechanism discussed above in diagram, just replace cash with Bitcoin future contract.And we are done for now.Let's see why Bitcoin Futures play an important role in the crypto world.

Bitcoin is not regulated, but Bitcoin Futures are regulated. This gives the average Joe confidence to get involved with bitcoin without actually owning any.
It brings in more investor and thereby may help the crypto market grow as now people are immune to the fluctuations in the price of Bitcoin.
It help increase market liquidity and stability.