"The enemy" Bakkt is about to debut, CME bitcoin futures "the throne is unstable"?

On September 23, three days later, Bakkt, considered to be "the biggest benefit of 2019," is about to debut, and the Chicago Mercantile Exchange (CME) will usher in a rival.

According to Skew data research, the volume of CME bitcoin futures contracted this week to the lowest level in four months, and the volume was only 50% of the peak in July. Market performance in the futures market is also seen as an indicator of weak bitcoin performance.

From the data in the figure, the trading volume of CME bitcoin futures in the first half of this year is continuously rising and hitting new highs. However, after entering August, its trading volume began to weaken, and in September it was even depressed.

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In August and September, the bitcoin market was in a state of volatility for most of the time. It was stuck in the vicinity of 10,000 US dollars for a long time, and the overall market situation was relatively flat. This may be one of the reasons for the decline in CME trading volume.

However, there are also market views that CME trading volume is sluggish or related to Bakkt. Currently, Bakkt has opened Bitcoin storage service, and will officially open its physical settlement of Bitcoin futures trading in three days, with CME's low trading volume period. The time is consistent.

CME "throne" is unstable?

Since the beginning of this year, CME's trading volume has been in a state of rapid growth, especially after the Chicago Board Options Exchange (CBOE) cryptocurrency futures trading will be officially closed, the development of CME is even more prosperous.

In December 2017, CBOE, the world's largest option market, first brought bitcoin futures to history, followed by CME's Bitcoin Futures Contract (BTC). CBOE and CME provide a regulatory trading environment for the digital currency market and are considered a watershed for the legality of cryptocurrencies.

However, on June 19 this year, CBOE ushered in the delivery of the last single bitcoin futures contract, and the CBOE cryptocurrency futures transaction was officially closed.

Compared to CBOE's backwardness, CME is firmly on the "throne" of the Bitcoin derivatives market.

According to a report released by CryptoCompare, a cryptocurrency research institute, CME has been dominant in the derivatives market since July. In August, CME's regulated bitcoin derivatives were $5.9 billion.

The volume of related derivatives in the current market is also lower than that of CME. The report said that the grayscale (Grayscale) bitcoin trust product GBTC transaction volume has decreased, only only 1.14 billion US dollars in August; GBTC number than July Reduced by 42.4%. BitMEX's BTC futures perpetual contract products totaled $51.8 billion, a decrease of 23.8% since July. BitFlyer's Lightning Japan sales were $27.8 billion, down only 3.9% since July.

But Bakkt is about to come to the "explosion field". Although Bakkt is a bitcoin futures delivered in kind, as the trump card of this year's cryptocurrency market, Bakkt will take away a large amount of cryptocurrency derivatives, even stealing. CME funds and flows.

Encryption analyst Plan B believes that Bakkt's bitcoin futures are more favorable than CME. He compared Bakkt to CME, a cash-settled futures exchange. CME may be disadvantageous because it relies on fiat currency. However, the addition of Bakkt is very important because it allows Bitcoin to be used to trade Bitcoin in the future, rather than French currency.

Digital currency analyst Joseph Young also said that CMEs accounted for a large portion of global Bitcoin trading volume when eliminating undetectable Bitcoin transactions (Bitwise data shows 95%). However, it is expected that Bakkt will change the landscape of the bitcoin market through compliance hosting and insurance.

These advantages of Bakkt are important! However, the price impact on Bitcoin after its launch is still unknown.

Bakkt is seen as bringing a lot of benefits to the market. Combined with previous market views, Scallop APP will be well organized as follows:

1. Bakkt provides physical delivery, which is different from US dollar settlement. This will increase the market's demand for bitcoin spot and reduce the price manipulation of bitcoin. Bakkt became the first in history to offer futures contracts for cryptocurrencies, allowing buyers to look forward to Bitcoin's physical delivery platform.

2. Bakkt will bring capital and flow to the cryptocurrency market, providing more liquidity for bitcoin transactions.

3. Bakkt provides a federally regulated and compliant system for institutions to purchase Bitcoin, providing institutional investors with a stable and secure access to the cryptocurrency market.

4. Bakkt clearing, settlement, and separation of custody, and holding the required license, is highly secure and legal.

5. Help retail bitcoin payments. Bakkt has partnered with Starbucks to create a template for low-cost systems that handle small bitcoin payments. Moreover, Bakkt seems to have done enough preparations. In August of this year, Bakkt was approved by the US Commodity Futures Trading Commission (CFTC) and the New York Financial Services Department (NYFDS). In the process of approval, Bakkt not only prepared for the trust, but also insured the assets.

But it's worth noting that the Bitcoinist analysis said the futures market may show sentiment and potential attempts to influence the BTC market. Because the launch of CME and COBE cash-settled futures was seen as a factor that could trigger a long-term decline in bitcoin prices in 2018. The question of how this product will affect the spot price of BTC still exists.

Source: Shallot blockchain

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