The Bitcoin market has developed and includes the simplest type of derivative financial products: futures contracts. These markets are now reaching a daily volume of 5 billion US dollars and take a significant share of Spot Trading markets.
Bitcoin price discovery shifts to the Futures markets
2019 have shifted, the mechanisms of Bitcoin pricing, since the effect of the Futures is more strongly felt. These markets invite traders to bet on price movements without regard to Bitcoins scarcity, or its actual use.
And since BTC is known to be volatile, and Trades are made on the basis of the dollar price. According to the latest estimates, the Futures reach volumes of up to 5 billion dollars per day.
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These volumes in both the cash settled Futures, the CME Swaps on BitMEX and OkEX as well as physically delivered Bitcoin Futures on Bakkt and Binance JEX.
Futures markets to compete with the discovery of spot prices
The effect of the Futures is most evident in connection with the BTC whales. Also Trader without access to Bitcoin can bet on the price. At the same time whales can try to influence the spot market through direct sale. The futures markets also reflect the demand for the actual BTC use outside of the price speculation.
Bitcoin Trading volume is still almost $ 18 billion in 24 hours, the spot markets still dominate. But also the futures markets to react with an immediate daily growth. In the past few days, the Bakkt Futures have achieved a number of records in the Trading and Open Interest.
Daily summary of Thursday’s Bakkt Bitcoin Monthly Futures:📉 – Traded contracts: 2832 ($21.17 million, -50%)
🚀 All time high: 5671 (11/27/2019)
💰 Open interest: $4.31 million (+4%)real-time updates: @BakktBot – Sats for server costs: https://t.co/TF6sNUwWpO pic.twitter.com/Oy1Uusx7vp— Bakkt Volume Bot (@BakktBot) November 29, 2019
The Bakkt volumes vary still, however, show that especially in times of high BTC volatility, and wait for traders on the sidelines. As the Skew statistic shows the response of the futures markets in the last few days in the November immediately with higher volumes, than the BTC prices for a more dramatic recorded daily movements.
BTC Futures also indicate a new development of the market sentiment. Spot markets, however, were in the past is unpredictable, because Bot activity and the whales were able to change the Trading within a few hours.
┌#BTC/USDT (4h) Report
├Close: 7606.8 ₮ (-3.2 ₮)(-0.0%)
├4h Vol : 243.65 M ₮(-13%)
┊├Buy(50%): 121.57 M ₮(-13%)
┊├Sell(-50%): -122.08 M ₮(-13%)
┊└Net(0%): -503.8 K ₮ ← -1.15 M
└ 🔴BEARISH under (7591.60)🔴 love it. pic.twitter.com/S8qTwPQNct— Binance Futures Tracker (@future tracker) November 28, 2019
Bitcoin tradete, on average, 7.589,05 $, with BitMex futures markets at 7,600,a $ 50. BitMex alone was today, Friday so far for 2.4 billion dollars in volume.