Last week Bitcoin hit record highs, filling headlines everywhere. However; the high price might not be what it seems, thanks to the growing price gap on exchanges. On Thursday, Bitcoin traded above $19,000 on the GDAX exchange, run by Coinbase, but on other platforms, it was trading at $15,000. This is a huge difference, and it is easy to see why people are getting frustrated with the news. Unfortunately, this is nothing new when it comes to Bitcoin, however, there can be no denial that this gap seems to be getting worse. So, just what impact does this have on buyers and sellers. Even if you sell at a higher price, it is unlikely that you would have paid a high price in the first place. The high price on the Coinbase exchange could be reflective as the easiest way for new Bitcoin investors to participate. It is worth noting though that although this might not seem like a problem now, it could transpire to become one over the next few days. Bitcoin trading is set to dramatically change, thanks to the launch of CBOE and CME Bitcoin future contracts. Unlike the exchanges, the futures exchanges are heavily regulated. The existing price gap can create some structural problems for the futures market. Let’s look at hedging as an example. If investors are trying to hedge a Bitcoin purchase, they will have to make sure they buy Bitcoins on an exchange that matches up with that particular contract. Perhaps the bigger problem is that it gives credence to Sprecher’s argument. This means that large price spreads indicate liquidity problems and a lack of active professional dealers and traders, who would normally arbitrage the differences away quickly. Less liquidity would suggest that the prices will drop faster when they do drop; however this is open to debate. The CEO of Airbitz, a Bitcoin wallet company suggested that Bitcoin’s fractured market was a feature and not a bug. So, if a large trade stumbled in one exchange, the price would be secured in others. Bloomberg favours the Bitcoin futures trading, as they believe that it will reduce volatility. More liquidity, should in theory make Bitcoin prices less volatile; however, a price drop could send futures trading heading for the exits, which would add to the fears over the traditional Bitcoin exchanges. This could result in negative feedback loops, which would push down the price of Bitcoins.