The Chicago Mercantile Exchange (CME) Group claims that it has processed more than 2 million bitcoin futures contracts since its inception, with a transaction volume of $70 billion.
The company said on Twitter on Wednesday that from December 2017 to July 21 this year, the platform traded more than 2 million contracts, equivalent to more than 10 million bitcoins. After Bitcoin rose 200% this year, interest in Bitcoin has increased, attracting a large number of customers.
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CME's competitor, the Chicago Board Options Exchange (Cboe), has stopped making bitcoin futures contracts and is one of the reasons for the rise in CME trading volume.
Since May of this year, CME has started to offer more contracts. The spot price of bitcoin in the month was slightly higher than the psychological resistance of $6,000. As of May 13, the exchange has issued a $1.3 billion bitcoin futures contract. A week later, the number of contracts hit an all-time high of about 5,190.
In June, this trend was further strengthened. CME said its bitcoin futures "created a new record on June 26th with a nominal record of $1.7 billion, which is more than 30% higher than the previous record."
“As interest from institutional investors continues to grow, soaring volume has also set a new record for 6,069 open positions.”
CME's Bitcoin futures are ideal for investors who don't want to hold Bitcoin but want to speculatively trade through a compliance platform. This means that all Bitcoin futures contracts are settled in physical cash upon expiration, not in the cryptocurrency itself.
This futures is often criticized by the cryptocurrency community for not giving any advantage to the real bitcoin market, but it is still considered an indicator of mainstream investors' interest in this cryptocurrency.
(CME June Bitcoin Futures Data)
The contract settled in Bitcoin is coming.
Bitcoin futures platform Bakkt, backed by the Intercontinental Exchange (ICE), began testing its one-day and one-month contracts on Monday. This marks the first contract in Bitcoin, which will increase the demand for bitcoin by institutional investors.
At the same time as the Bakkt promotion plan, LedgerX and ErisX will also launch futures contracts settled in Bitcoin. Neither company announced the release date of the product, but it has obtained permission from the US Commodity and Futures Trading Commission (CFTC).
However, this does not mean that the three companies will be on the road to compliance. For example, Bakkt is launching a self-certified bitcoin futures contract that needs to be approved by the CFTC based on the pros and cons of the product. Once approved, Bakkt will need to apply for BitLicense from the New York Financial Services Department (NYDFS), which is difficult to apply and is controversial.
On the bright side, NYDFS has recently formed a special department for the cryptocurrency industry to simplify the license application process.