Upcoming CME Bitcoin Futures May Draw More Trading Volume

Since last week Bitcoin futures have officially started trading on CBOE Global Markets. Many Bitcoin investors are anticipating a rapid price movement once CME group launches its own Bitcoin futures contract this week.

The Effects of Bitcoin Futures

Bitcoin futures are currently one of the most popular topics in the Bitcoin and finance communities.  In the last couple of weeks, many investors and traders were eagerly waiting for Bitcoin futures to officially start trading. Last week, the Chicago Board Options Exchange (CBOE) officially launched its own Bitcoin futures contract for trading. Most traders speculated that Bitcoin would drastically lose value, as rumors spread that many institutional investors would try to short the decentralized cryptocurrency.

On the first day of trading, the futures surged by 20% and 4,000 contracts were exchanged in total, a relatively low trading volume since the average is more than 100,000. Experts believe that the main reason for that is the uncertainty that clouds Bitcoin and cryptocurrencies. Many institutional investors are still struggling to fully understand Bitcoin and its technology, and thus hesitate to invest in the digital currency.

Upcoming CME Futures

The Chicago Board Options Exchange isn’t the only entity that is launching a Bitcoin futures contract. The Chicago Mercantile Exchange (CME) is also planning to launch Bitcoin futures in the upcoming week. Analysts believe that the CME will be able to bring in more trading volume and perhaps further influence the price of Bitcoin. In a recent Reuters article, Matt Osborne, chief investment officer of Altegris  stated following regarding CME’s Bitcoin futures contract:

The CME contract is based on a broader array of exchanges. So there is a possibility that the CME contract may generate more interest and more volume. It’s important to keep that in mind when (investors) are trying to make a decision.

He also added:

Volumes are going to slowly increase as professional traders get comfortable with the price action and more importantly get comfortable with the volatility and the margin usage,

It will definitely be interesting to see how high CME’s trading volume will be. Traders are anticipating strong price movements once the futures officially start trading on the CME. Recently Bitcoin hit another all-time high price and is currently trying to stabilize at the $20,000 mark.

What are your thoughts on CME’s upcoming Bitcoin futures? Do you think that CME will be able to attract more interest from investors and traders? Let us know in the comments below!

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