Futures markets are flourishing even if the price drops

Futures markets are flourishing even if the price drops

Last week’s decline in Bitcoin scared retail investors, but encouraged institutional investors. US-regulated BTC futures markets recorded large volumes, along with all other derivatives.

The growing demand for crypto derivatives is a clear sign of the growing interest of institutional investors, despite the high level of volatility in the market.

Futures markets are thriving

The market value of Bitcoin has dropped by more than $ 2000 over the past two weeks. From a maximum of $ 9,100 on November 11, BTC reached $ 6,600 on November 25.

During this period, nearly $ 1 billion of long and short positions were settled on the BitMEX derivatives trading platform.

On November 22, Bakkt, on the other hand, reached a record trading volume of 2,728 physically liquidated BTC futures contracts. This represented an increase of 66% over the previous 24-hour period.

During November 27, when Bitcoin began to grow again, the volume reached 3151 contracts, the equivalent of $ 23 million. Sign that futures markets are flourishing.

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A similar phenomenon occurred on the Chicago Mercantile Exchange (CME). On Friday, CME reported $ 424 million in total trading volume, while on Monday it recorded $ 400 million. This is the largest aggregate trading volume recorded since September.

Grayscale funds attract massive volumes

Institutional investors seem to enjoy the volatility of BTC prices. The data reported by Grayscale Investment show massive capital inflows this quarter. They have reached $ 171.7 million in the Bitcoin Trust. According to the company, this is the “largest” quarterly entry in the product’s six-year history.

Due to increased demand from accredited investors, the company has filed a voluntary registration statement on SEC Form 10 for Bitcoin Grayscale Trust. If approved, the investment trust would become the first crypto investment instrument to obtain company status reporting to the SEC.

Increasing interest in bitcoin among institutional investors shows that the crypto market is maturing. Many countries have begun to develop regulatory frameworks that will allow financial institutions to trade this cryptocurrency.