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Bitcoin futures got off to a good start on Tuesday as Cboe's and CME's April contracts rose more than 16% to $ 4,805.
#Bitcoin futures contracts climbed 16% to their highest level since November pic.twitter.com/WLW4yDumYv
– CNBC Futures Now (@CNBCFuturesNow) April 2, 2019
In a note to Barron, Gaboracs, digital badet strategist at VanEck, says he believes that the recent surge in Bitcoin prices since its highest level since November 2017 is due to the futures market.
Said Gurbacs,
"CME Bitcoin futures expired last Friday. A large number of positions were converted (buy) into BTC's new futures contract in the month before. Over the weekend, mbadive purchases of bitcoins and OTC followed the expiration of Bitcoin futures, driving the price of BTC up slowly and steadily. While prices have been steadily increasing, short films worth more than $ 500 million have been liquidated on leveraged cryptographic derivatives trading platforms around the world. "
Bitcoin jumped more than 17%, reaching $ 5,100 on Tuesday, followed by a generalized rally with double-digit gains. Bitcoin is currently trading at $ 5,012 at the time of writing, according to data compiled by CoinMarketCap.
Futures trading volumes on altcoins, including Bitcoin Cash and Litecoin, have also seen stronger growth in recent weeks. Crypto Facilities, a San Francisco-based Kraken subsidiary, announces a $ 150 million transaction volume for its crypto derivatives.
Prior to Kraken's acquisition of Crypto Facilities, its Litecoin futures had an average notional volume of $ 15 million per month and the volumes of its contracts with Bitcoin Cash were approximately $ 10 million per month.
Last month, these volumes soared, reaching $ 100 million and $ 50 million for Litecoin and Bitcoin Cash, respectively.
In an interview with CoinDesk, Sui Chung, head of indices and pricing products at Crypto Facilities, said:
"We started shipping Kraken users … [and] this has allowed us to become better acquainted with communities around Litecoin and Bitcoin Cash, and I think what we are seeing is that these communities have a strong interest in derivatives trading for Litecoin and Bitcoin Cash, respectively, "
Based in London, Crypto Facilities is regulated by the Financial Conduct Authority. According to Chung, customer demand for fee-based crypto-regulated futures in the underlying crypto-currencies is the driving force of the market.
"I think that these communities have always demanded a strong derivatives contract, guaranteed and paid in coins because there are contracts in other markets … where the core badet is Litecoin but payments Bitcoin . Our contracts are paid in Litecoin and Bitcoin Cash. "
In February, after the acquisition of Kraken, Crypto Facilitates announced that a billion dollars in Bitcoin, Ethereum, XRP, Litecoin and Bitcoin Cash futures were trading on its platform.
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