BTC Futures with 100x Trading Volume

November 28, 2019, by Marko Vidrih on ALTCOIN MAGAZINE

In mid-September, there was still a lot of skepticism as to whether the Bakkt Bitcoin Futures would meet with the expected response. Is the big money coming from institutional investors?

Admittedly — at the beginning of the Bakkt opening in September, we also reported that the start of the Bitcoin Futures started lazily. At the same time, however, we also said that starting such a platform always requires a certain start-up time.

And exactly this start-up time seems to be over now. Since September, the daily trading volume of Bitcoin Futures has been increased by 100x. While volumes of $250,000 a day were traded in the early days, yesterday on Bakkt a whopping 5671 Bitcoins worth more than $42 million were traded.

First and foremost, of course, it’s good news that Bakkt is growing so fast. Because obviously the interest for the Bitcoin Futures increases permanently. Crypto analyst Alex Krüger still doesn’t see the news as too bullish. Because the number of actually, physically delivered Bitcoin is almost zero. Thus, according to Krüger, it is much more about ‘paper trading’ than the actual delivery of BTC.

Bakkt has managed to build a bullish momentum with Bitcoin Futures. To cheer this even further, it already holds two more aces up its sleeve. So there will be Bitcoin options starting December 9th. Futures and options are two very similar financial instruments. The difference is small but significant:

While futures are legally binding, an investor in options acquires much more the purchase or the right to sell. This means that an investor does not have to buy / sell the asset directly on the delivery date (= expiry date of the contract). Put somewhat more succinctly: Futures are firm and legally binding. Options are more flexible.

Let’s take a quick look at the second ace that keeps up Bakkt: so-called cash-settled futures. While the unique feature of Bakkt has been to limit itself to physical Bitcoin Futures, this will now change. The cash-based futures will also be launched on December 9.

Author: Marko Vidrih