The increased open interest of Bitcoin futures shows that more and more institutional investors are entering the market.
The CME Group is currently the world’s largest market for Bitcoin futures after the derivatives exchange saw a significant increase last month
In a tweet on Friday, the crypto market researchers from Arcane Research found that the CME has replaced the trading platform OKEx as the leading market for Bitcoin Era. Citing data from Skew, Arcane points out the open interest of CME Bitcoin futures, which is currently valued at $ 1.16 billion. For OKEx, however, the “open interest” is $ 1.07 billion. The open interest is a key figure that shows the total value of all „open“ futures in the market.
The “institutional investors are there”, as Arcane concludes from the available data.
This conclusion is probably based on the fact that institutional investors mostly prefer to invest in crypto derivatives instead of buying the cryptocurrency directly. Increased open interest indicates that these investors are all the more active. A fact that is underlined by the strength of the CME Group , because the derivatives exchange is one of the leaders in its field and is therefore all the more attractive for institutions.
The market for Bitcoin futures on the CME more than doubled in the past month , which is due to the fact that many investors want to participate in the current soaring of the cryptocurrency. However, futures trading is often very volatile, especially as the contracts are nearing their expiration date.
The November futures (BTCX20) expire on Friday , which could be an additional reason for the CME’s surge
The crypto exchanges Binance and Huobi have also emerged as leading players in the futures market this year. In terms of open interest, they represent the third and fourth largest market for Bitcoin futures.
Trading platform Bybit, also on Arcane’s list, announced this week that it plans to launch quarterly Bitcoin futures soon.
As already mentioned, institutional investors in particular use the opportunity to invest in Bitcoin via derivatives. Because of this, the futures market serves as a good indicator of the rising interest of institutions. While the great crypto hype of 2017 was primarily carried by private investors, the current high altitude is much more underpinned by institutional investors.
The asset management company Wilshire Phoenix sees the CME as an important market for Bitcoin pricing .
So says Wilshire, that the importance of CME „is demonstrated not only by the values of trading volume and open interest“, but also „through their influence on prices on the spot market.“ The spot market is the market where Bitcoin is traded directly.
The Bitcoin price is currently moving sideways in a price range around 16,500 US dollars after heavy losses on yesterday Thanksgiving Day .