Bitcoin Futures Trading Up 93%, Reports CME Group

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Bitcoin Futures Trading Up 93% Reports CME Group

A recent tweet from CME Group, one of the first companies to offer bitcoin futures trading, reports that average daily trading volumes are up 93% and open interest surpassed 2,400 contracts, a 58% increase.

There have been mixed opinions about the success of bitcoin-based futures options since their inception in December 2017, when Cboe Global and CME Group were both authorized to offer the investment products.

Bitcoin-based futures trading has, however, also faced the same challenges as cryptocurrency markets as a whole, with hesitant institutional investor interest, a price and market capitalization decline, and global regulatory uncertainty.

Despite the performance of cryptocurrency markets overall, bitcoin-based futures trading has seen increased interest and liquidity.

CME Group Reports Growth

Yesterday, CME Group tweeted its Q1 and Q2 comparison, showing a healthy increase in Q2 compared to Q1, 2018.

In a press release dated July 15, 2018, CME Group reported overall international average daily volumes of 4.2 million contracts in Q2, 2018 – an increase of 13 percent from Q2 2017 – showing that bitcoin-based futures are still a tiny, but growing, fraction of traditional investment markets.

Cboe Global Statistics

Cboe Global was the first to offer bitcoin-based futures and is the largest U.S options exchange. According to Cboe’s daily market statistics, on July 20, 2018, its open interest for bitcoin-based futures stood at 4,416, with trading volume of 5,170. Historically, Cboe has seen greater overall volume than CME Group.  On April 25, 2018, Cboe recorded a record 18,000 contracts.

Cboe is potentially seeing greater interest with its renewed efforts to gain approval from the U.S Securities and Exchange Commission (SEC) for the first bitcoin-based exchange traded fund (ETF). A positive decision for Cboe will likely impact cryptocurrency markets considerably with the creation of a further institutional style product. This could also be influencing volume right now for CME Group.

BlackRock Inc, the world’s largest provider of ETFs has reportedly assembled a working group to investigate cryptocurrency-based products. The news may have contributed to last week’s hike in cryptocurrency market prices as investors were encouraged by the additional interest in today’s new financial markets.

How much do you think cryptocurrencies can impact traditional investment markets in the second half of 2018?

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