• Press Releases
    • Submit a press release
    • Read All
  • Advertise
  • Contact us
Crypto.com Logo Crypto.com Logo
Bitcoinist.com
No Result
View All Result
  • Bitcoin
    • News
    • Price
    • Businesses
    • Acceptance
    • Technology
    • Investment
    • Regulation
    • Reviews
    • All Bitcoin News
  • Altcoins
    • News
    • Price
    • Ethereum
    • Ripple
    • Litecoin
    • EOS
    • NAGA
    • All Altcoin News
  • Tech
    • Blockchain
    • Security
    • FinTech
  • Industry
    • Press releases
  • Price
    • Bitcoin Price
    • Ethereum Price
    • Litecoin Price
    • Binance Coin Price
    • Monero Price
    • MimbleWimbleCoin Price
  • How to
    • Buy gift cards/mobile Top Ups with Cryptos
    • What Is Bitcoin?
    • Best Bitcoin Wallet
    • Bitcoin vs Ethereum
    • Why Use Blockchain Technology?
    • Bitcoin Cash ABC vs. Bitcoin Cash SV
    • How to Buy Cryptocurrency
    • Bitcoin Mining
    • Best Bitcoin Brokers
    • Best Bitcoin Forex Brokers
    • How To Earn Btcoin
    • What is Facebook Libra?
    • Ripple and XRP: The Complete Guide
  • Play Games
  • BET&WIN
  • Bitcoin
    • News
    • Price
    • Businesses
    • Acceptance
    • Technology
    • Investment
    • Regulation
    • Reviews
    • All Bitcoin News
  • Altcoins
    • News
    • Price
    • Ethereum
    • Ripple
    • Litecoin
    • EOS
    • NAGA
    • All Altcoin News
  • Tech
    • Blockchain
    • Security
    • FinTech
  • Industry
    • Press releases
  • Price
    • Bitcoin Price
    • Ethereum Price
    • Litecoin Price
    • Binance Coin Price
    • Monero Price
    • MimbleWimbleCoin Price
  • How to
    • Buy gift cards/mobile Top Ups with Cryptos
    • What Is Bitcoin?
    • Best Bitcoin Wallet
    • Bitcoin vs Ethereum
    • Why Use Blockchain Technology?
    • Bitcoin Cash ABC vs. Bitcoin Cash SV
    • How to Buy Cryptocurrency
    • Bitcoin Mining
    • Best Bitcoin Brokers
    • Best Bitcoin Forex Brokers
    • How To Earn Btcoin
    • What is Facebook Libra?
    • Ripple and XRP: The Complete Guide
  • Play Games
  • BET&WIN
Bitcoinist.com
No Result
View All Result
Nexo

The Allure of Bitcoin Futures Trading

Osato Avan-Nomayo by Osato Avan-Nomayo
4 years ago
in Bitcoin, Markets and Prices, News, News teaser
0
Advertisement

Bitcoin futures trading continues to grow since both the CME and Cboe launched their futures contracts in late 2017. Experts believe that the reduced volatility, as well as clearer regulations, make the market more appealing to mainstream investors.


Bitcoin Futures Trading Continues to Grow

Market analysts say Bitcoin futures trading continues to be popular among mainstream investors. Commenting on the steady growth, Tim McCourt, the head of equity products and alternative investments at CME said:

5 BTC + 300 Free Spins for new players & 15 BTC + 35.000 Free Spins every month, only at mBitcasino. Play Now!

We see continued growth both in terms of the average daily volume and open interest. The volume has steadily increased compared to when it was first launched in December. This is not a one-sided product because we have both supply and demand. Customer demand is strong because the relationship between the futures and cash market have a tight basis spread.

Reports from CME show that there was a massive spike in Bitcoin futures trading on July 5, 2018, with 6,739 contracts. This figure is significantly higher than the daily average of 2,800 contracts. Mati Greenspan of eToro said that the spike was a misnomer given that there wasn’t any corresponding surge in Bitcoin’s price during the same period.

Less Volatility and Better Organization

Bitcoin, like many other cryptocurrencies, is prone to wild price swings. Thus, spot trading does come with the added hazard of realizing spectacular losses if the price trajectory follows an unfavorable path. Many experts believe that Bitcoin futures contracts offer a path to the asset without the issue of volatility.

Less Volatility and Better Organization

BitStarz Player Lands $2,459,124 Record Win! Could you be next big winner?
Get 110 USDT Futures Bonus for FREE!

Commenting on this observation, Andrew Wilkinson, the chief market analyst at Interactive Brokers Group said:

Compared to the spot market, the bitcoin futures market has less volatility and is slightly more organized. The luxury of the futures market is that you can take advantage of price movements and there is better price transparency.

However, Bitcoin futures trading also has its downside. According to Wilkinson, the lack of liquidity and enthusiasm are prominent issues in the market. Wilkinson also identified the inability of investors to pull out of a long position when prices begin to decline as another problem for the market.

Cash Settled Futures Have Minimal Impact on Bitcoin Price

Despite the apparent popularity of the market, trading in Bitcoin futures doesn’t yet constitute a problem for the asset price. On several occasions, many analysts have pointed to the introduction of the CME and Cboe BTC futures trading as a reason for the Bitcoin price slide.

This reasoning fails on two accounts. First, BTC futures contracts are cash-settled meaning that there is no movement of the underlying asset. Thus, the futures market has no adverse effect on asset volume. Secondly, the total BTC futures market is merely a drop in the ocean compared to the spot trading Bitcoin market. Therefore, the idea that BTC futures have affected the price of Bitcoin is factually incorrect.

Do you think the Bitcoin futures can grow to a level where it begins to impact the price of the asset? Keep the conversation going in the comment section below.


Images courtesy of ShutterStock

ShareTweetShareShare

Sign Up for Our Newsletter!

For updates and exclusive offers enter your email.

I consent to my submitted data being collected and stored.
Osato Avan-Nomayo

Osato Avan-Nomayo

When I am not knee-deep in cryptocurrency-related news, I am either attempting to beat my scrabble high score or internally debating an existential dilemma.

Related Posts

short bitcoin

Inverse Bitcoin ETF Sees 300% Increase In Short Interest

3 hours ago
Bitcoin

Bitcoin Bear Market Sends On-Chain Metrics Into Sideways Trend

7 hours ago
bitcoin addresses

Decline In Bitcoin Active Addresses Suggests Market Is Purging Paperhands

9 hours ago
Crypto

Crypto Lender Voyager Digital Goes Bankrupt After Three Arrows Collapse

12 hours ago
South African Firm Raises $150 Million To Introduce Crypto Water Tokens Dubbed H2ON

South African Firm Raises $150 Million To Introduce Crypto Water Tokens Dubbed H2ON

18 hours ago
Jordan Belfort

Jordan Belfort, The ‘Wolf Of Wall Street,’ Advises: Buy Bitcoin Today And Make Money

19 hours ago

Bitcoin news portal providing breaking news, guides, price analysis about decentralized digital money & blockchain technology.

Bitcoin

  • News
  • Price
  • Businesses
  • Acceptance
  • Technology
  • Investment
  • Regulation
  • Reviews

Altcoins

  • News
  • Price
  • Ethereum
  • Ripple
  • Litecoin
  • EOS
  • NAGA

Categories

  • Blockchain
  • Security
  • FinTech
  • Technology
  • Trending
  • Breaking News
  • Press Releases
  • How to

Pages

  • Contact us
  • Editorial Policy
  • Advertise
  • Crypto Prices from Nomics
© 2022 Bitcoinist.com. All Rights Reserved.
  • Bitcoin
    • News
    • Price
    • Businesses
    • Acceptance
    • Technology
    • Investment
    • Regulation
    • Reviews
    • All Bitcoin News
  • Altcoins
    • News
    • Price
    • Ethereum
    • Ripple
    • Litecoin
    • EOS
    • NAGA
    • All Altcoin News
  • Tech
    • Blockchain
    • Security
    • FinTech
  • Industry
    • Press releases
  • Price
    • Bitcoin Price
    • Ethereum Price
    • Litecoin Price
    • Binance Coin Price
    • Monero Price
    • MimbleWimbleCoin Price
  • How to
    • Buy gift cards/mobile Top Ups with Cryptos
    • What Is Bitcoin?
    • Best Bitcoin Wallet
    • Bitcoin vs Ethereum
    • Why Use Blockchain Technology?
    • Bitcoin Cash ABC vs. Bitcoin Cash SV
    • How to Buy Cryptocurrency
    • Bitcoin Mining
    • Best Bitcoin Brokers
    • Best Bitcoin Forex Brokers
    • How To Earn Btcoin
    • What is Facebook Libra?
    • Ripple and XRP: The Complete Guide
  • Play Games
  • BET&WIN

© 2021 Bitcoinist. All Rights Reserved.

This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy Center or Cookie Policy.