CME Bitcoin futures experiencing unprecedented growth levels

on Jan 25, 2020
Updated: Mar 11, 2020
  • Demand for Bitcoin futures on Chicago Mercantile Exchange (CME) keeps rising as CME plans to consolidate on the bullish market for more growth.
  • Increased activity in the bitcoin market is CME’s main motivation. The exchange plans to continue making bitcoin futures a recognized stream of revenue.
  • Other platforms are experiencing the same growth in Bitcoin futures, but not as high as the current rate at CME.

The demand for Bitcoin futures has increased in the New Year, as the Chigaco Mercantile Exchange (CME) is reporting an increased open interest. Ina recent statement by Arcane, the CME keeps growing steadily in the demand for Bitcoin futures compared to other platforms. CME bitcoin’s future demand has risen to a great level, with a strong projection of June premiums.

Demand for Bitcoin futures at CME keeps rising

Based on the report by Skew, CME’s Bitcoin future’s open interest stood at 101% between the 1st and 20th January. Another Bitcoin derivatives platform, Bakkt, also improved in its bitcoin future open interest, as it realized an interest of $3.8 million on the 1st of January. However, the figure rose to an impressive $7.8 million by 20th January.

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But results from other platforms show that the performance of Bitcoin is more closely in line with gold than S & P. Just three weeks into the New Year, bitcoin has gained about 14.41%, and at the time of writing, the price of the digital asset stands at $8,314.72.

As there is an improved relationship between BTC and ETH, the price of the later has equally increased, but not to the level of BTC. The asset is currently valued at $161.35. We are still in the first month of the year, and there are strong reasons for investors to be optimistic about the growth prospects of both Bitcoin and Ethereum.

The Bitcoin market spurs CME’s confidence

As a multi-billion dollar derivatives firm, CME would have no need to push for Bitcoin futures, Bitcoin options, and other investment vehicles if the market for Bitcoin wasn’t favorable. Tim McCourt, the firm’s executive said the company trade on Bitcoin’s future is almost $264.8 million daily.

He stated that the company is happy that its Bitcoin futures have become one of the most liquid as it has evolved quickly within the past two years. According to him, the Bitcoin futures contract has averaged about 31,850 Bitcoin with 6400 contracts per day.

At the current price of $8,314 per BTC, it means that 31, 850 BTC would be equivalent to about $264.8 million. The growth is comparable to the spot volume of other major exchanges in the world crypto market.

Bitcoin futures a recognized stream of income for CME

As far as CME is concerned, Bitcoin futures, as well as other product derivatives, are recognized streams of revenue for the company. The high level of activity on Bitcoin futures also spurs the company to continue in the crypto market.

Just seven days after its launch, the volume of CME’s biotin options doubled. According to the company, it shows the level of demand for Bitcoin derivatives, and the company is planning on focusing more on these investment mechanisms on its platform.

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