The Chicago Mercantile Exchange (CME) Group says its Bitcoin futures contract trading grew by 41 percent in the third quarter of 2018. CME also said that Asia contributed to half of the overseas BTC futures trading volume.
Bitcoin Futures Trading No Longer Stagnant
In a tweet posted on Wednesday (October 17, 2018), CME announced the Q3 performance of its BTC futures contract. According to CME, the average daily volume (ADV) stood at 5,000 contracts which meant an increase of 41 percent from Q2 figures (3,577 contracts). Q3 results also indicate an almost 170 percent from Q1’s performance – 1,854 contracts.
In Q3, Bitcoin futures average daily volume rose 41% and open interest was up 19% over Q2 . Learn how market participants are using BTC to manage risk in changing markets. https://t.co/Yt41SzsHku pic.twitter.com/Kw4OX0QaKT
— CMEGroup (@CMEGroup) October 17, 2018
The open interest (OI) also rose by 2,870 individual contracts, an increase of 19 percent from Q2 (2,400) and 93 percent from Q1 (1,500). It appears the declining price of the underlying asset has done little to dampen the enthusiasm for the futures trading product. In August, Live Bitcoin News reported that CME futures still held sway over Coinbase spot trading volume.
Bitcoin has declined by more than 60 percent since the start of the year. It has also spent the last few months caught in a sideways trading loop though some observers say a breakout is imminent.
The Q3 increase comes despite a period of stagnation in August. At the time, CME reported that its BTC futures contract had stalled for three straight trading sessions with less than 2,500 BTC transactions. This period of stagnation caused a fall of almost 70 percent in about eight days.
Asia Leads the Foreign Markets in Bitcoin Futures Trading
In September, CME revealed that Asia was leading the overseas market for BTC futures trading. According to the CME Group managing director and equity products and alternative investments chief, Tim McCourt:
Out of the 40 percent of bitcoin futures trading on CME that’s outside the United States, approximately 21 percent are coming from Asia.
Plans to Launch Altcoin Trading Products
There are reports that the CME plans to launch altcoin trading products based on the success of their BTC futures trading. According to a recent post from the CME, it is mulling the creation of a reference rate and real-time index for the Ether-Dollar pair.
The CME launched its BTC futures contract in December 2017 coinciding (and maybe even contributing) to the meteoric rise in BTC price that saw the top-ranked cryptocurrency almost reach $20,000. The CBOE also launched its BTC futures during the same period.
Are you surprised to see an increase in Bitcoin futures trading despite the sideways price action for the top-ranked cryptocurrency? Let us know your thoughts in the comment section below.
Image courtesy of Twitter (@CMEGroup) and ShutterStock