Bitcoin [BTC] Futures: CME, Bakkt Log New Highs in Open Interest and Volume

Nivesh Rustgi News August 4, 2020

Bitcoin
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Bitcoin [BTC] Futures: CME, Bakkt Log New Highs in Open Interest and Volume

Bitcoin [BTC] futures volume and open interest on institutional platforms like CME and Bakkt are at All-Time Highs. The surge began around 27th July with the 11.08% break-out above $11,000.  

bitcoin cme futures
Bitcoin [BTC] Futures Open Interest on CME
The monthly futures price in contango further confirms the bullish inclination of the large OI. Contango implies that the price of future month contracts is higher than the months before it. During extreme bullish sentiments, this premium rises to over $1000.

cme bitcoin futures
Bitcoin [BTC] Futures CME Price Quote
According to leading market analyst, the rise in OI on CME on the back of huge volume indicates institutional interest. Kyle Davies, the co-founder of Three Arrows Capital confirms that,

CME’s contract is 5 BTC notional and frequently large block trades account for a LOT of the volume. This is US institutional chads not retail.

Not only CME, another popular platform for institutional traders, Bakkt Bitcoin futures OI is also at an ATH.

bitcoin bakkt futures
Bitcoin [BTC] Bakkt Open Interest
What happened during the weekend seems like a temporary reaction to over-leverages longs on unregulated exchanges. This is a novel instance where the funding and basis on unregulated perpetual contracts seem to be lagging the growth in CME and Bakkt. Leading analytics firm, Skew finds that,

CME is now #3 in terms of largest open interest for #bitcoinfutures, only OKEx and BitMEX are ahead

During extreme euphoric conditions, the OI on BitMEX And Okex have been known to cross $1 billion. Currently, it is less than $700 million. The funding rate for altcoins on BitMEX is, nevertheless, on an over-drive. The funding rate and basis on Okex, however, is less than 1% (positive, nonetheless). Hence, the overall crypto market sentiments seem bullish.

bitcoin funding rate
Bitcoin Latest Funding Rate Report Aug 4

Do you think the crypto market is read for another bull-run? Please share your views with us. 

Author: Nivesh Rustgi
Nivesh from Engineering Background is a full-time Crypto Analyst at Coingape. He is an atheist who believes in love and cultural diversity. He believes that Cryptocurrency is a necessity to deter corruption. He holds small amounts of cryptocurrencies. Faith and fear are two sides of the same coin. Follow him on Twitter at @nivishoes or mail him at nivesh(at)coingape.com
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Nivesh Rustgi 1180 Articles
Nivesh from Engineering Background is a full-time Crypto Analyst at Coingape. He is an atheist who believes in love and cultural diversity. He believes that Cryptocurrency is a necessity to deter corruption. He holds small amounts of cryptocurrencies. Faith and fear are two sides of the same coin. Follow him on Twitter at @nivishoes or mail him at nivesh(at)coingape.com
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