TD Ameritrade is one the largest brokerages in the world. They're listing #Bitcoin futures on Monday. Imagine all the investors that want to put 1%-5% of their portfolio into #BTC!
TD Ameritrade customers who have at least 25K USD will have access to CBOE Futures (NOT CME) on Monday. Customers will be required to post margin (probably in USD). CME futures may be added at a later date when TD Ameritrade feels like it is "safe" to do so.
The ELI5 is best left to investopedia but I'll give it a shot.
This is generally regarded as good news. You may understand why in a second.
Edit: This is getting a little popular so I want to clarify something: The contract size of 1 futures contract on the CBOE is (I think) 5 bitcoins. It is that on one of the exchanges. So the example I give below is not numerically, but is philosophically, correct. - Fuck Danny.
So, the CBOE is allowing people to bet on the price of bitcoin in the future. Check out the prices here.
The CBOE is acting a holder of bitcoin and trader of, essentially, gambling slips on the price of bitcoin. A futures contract is an agreement to buy something (bitcoin here) later at a specific price. This is great for markets with price movements because it allows people to be secure in the price of a thing and therefore do planning regarding that price.
Imagine a car manufacturer needs aluminum at $100 a ton in order to charge a reasonable amount for their cars. So they agree to pay that for the next year and some broker or trader agrees to sell it for that to them next year. That same broker or trader then has two options - own that aluminum and sell it at that price (which is great is the price is falling as they can buy it cheaper and make money) or find some aluminum holder / producer who will sell it cheaper and lock in a price. Say, $95 a ton. Then that trader makes $5 a ton next year on however much aluminum he sold to the car manufacturer and moves on to finding more trades to make.
Same thing with bitcoin. The CBOE is the broker (exchange) and I (TDA account holder) believe bitcoin will be $20,000 next month. Fuckin' A, look at that, the current contract price is $18,090. If I buy that contract right now then I believe my profit will be $2000. Hell yeah I'm going to buy that.
Now Danny Downer thinks bitcoin will be at $16,000 next month. Fuck him, right? But hey he has a right to his opinion and furthermore he may be right (the fucker) so he SELLS that contract. CBOE is happy with that because no matter what happens they made a commission price and offset their risk on the price movement. Think about the outcomes.
The price of bitcoin stays exactly at $18,090. I buy it at that price, Danny sells it at that price and the real price is $18090 and neither of us make or lose anything. Worse scenarios exist but nobody gets laid.
Scenario two, Danny is right! Fuck Danny! Danny sold me Bitcoin at $18090 and since it's trading at $17090 I owe that fuck $1,000 which the CBOE gives him and takes from me.
Scenario three, I'm right. Fuck Danny! Bitcoin settles at $20,090 and Danny sells me bitcoin at $18,090 but he has to buy it at $20,090 first thus losing $2000 while I gain $2,000. I'd rather have the bitcoin but the contract is cash settled so I get boring old dollars instead, such is life. I can of course take those dollars and spend them on bitcoin should I so desire.
Now, why is this good or bad for bitcoin? It's good because I can secure a price for bitcoin right now. I can buy 3 bitcoin and sell a contract on 1 of them, locking in a guaranteed price (usually higher than the current price) on that one and thus taking that much less risk on the overall position. And if I should have to pay out on that because the price rises? Cry me a river - the price of the asset rose. I made money, and still own the underlying bitcoins and thus continue to make money on a rising price.
This is risk reduction, and that makes for a more attractive investment.
There's a ton of things you can do like this, lots of options and futures strategies. Another good thing is that since this is happening on a fast, secure and well monitored platform it can help price discovery and trading move very very quickly. Furthermore people will become more acclimated to bitcoin as a 'thing' and trading it and everything else. It'll be more a part of their consciousness.
What will the effect be? My opinion is that it'll drive greater investment.