In Chicago, home of the Chicago Mercantile Exchange Group (CME Group), it seems that the case of buying rumors and selling news is all the rage.
As a result, the amount of funds deposited in the “Open Interest” (OI) contract for Bitcoin futures has surged since early September. Consider open interest as investors partner to help bet on market activity. CME data shows 10,918 BTC futures OI contracts as of October 12, an increase of 4,556 contracts (+ 72%) in 6 weeks, which is in the black compared to the start of the year. -February.
As recently Forbes According to the report, a relatively small number of commercial traders play an important role on the demand side, as reflected in the rise in CME Bitcoin futures OI. While the identities of these companies are protected by both the CME and CFTC reporting protocols, the methods tagged within the CFTC Commitments of Traders report are companies and non-US financial institutions, providing deep insight into the industry. Indicates that you have. This also shows that they are sophisticated enough to enter the futures market and have enough capital to do so with a large amount of money-each BTC futures contract is worth 5 Bitcoin. Yes, it’s worth about $ 287,625 at a typical Bitcoin price. Hedge funds have also provided liquidity in recent weeks. Think of liquidity as the money that every buyer needs to find a seller, according to CME Group’s trading rules.
The identities of the trading groups involved in the 72% surge from October 5th to October 12th will only be known on Sunday when the CFTC publishes a new COT report. However, as of Tuesday night, it is known that the weekly increase in BTC futures OI exceeded 2,000 contracts. This is a very high level of weekly change.
This surge in CME crypto futures is probably not a moment. The value of all crypto futures OIs plunged into record territory on October 5th at $ 3.3 billion. This means that Bitcoin is already higher than April, when it was trading at a record high of $ 64,900. In other words, there is little reason for so much capital to be bound unless these knowledgeable CME futures investors expect big positive developments before the contract expires. One possible reason is that we expect Bitcoin ETFs to be approved soon. CME futures are known to make a big difference, and by their appearance, they may have already begun.
The importance of Bitcoin futures supporting BTC ETF cannot be exaggerated. Executable Bitcoin ETF applications that rely on BTC futures include those by ProShares, Invesco Ltd.
But of course, the blame for this story involves the SEC and its new chairman, Gary Gensler. Gary Gensler could quickly disappoint Bitcoin ETF fans by quelling retail speculative activity in the currency market while under the command of the CFTC. Time tells us what will happen in the end, but the stakes are high and it seems that the really big ones are cooking.