Published: Wed, January 15, 2020
Markets | By Otis Pena

CME Bitcoin Options Eclipses Bakkt With a Strong Start

CME Bitcoin Options Eclipses Bakkt With a Strong Start

On a related note, the altcoin market more generally has severely struggled against bitcoin over the past couple of years.

For the new options contract, 1 Bitcoin Futures contract (which represents 5 bitcoin), is set to trade on CME Globex and CME ClearPort from 5 pm to 4 pm CT Sunday-Friday, and will offer BTC traders the potential to save on margins, through margin offsets.

A news report by Bloomberg indicates that a group of analysts at JP Morgan Chase, headed by Nikolaos Panigirtzoglou, has disclosed that interest in CME's prevailing Bitcoin futures had increased in the days ahead of the roll out. These levels had remained absent since mid-November 2019.

However, one of the biggest indicators of the upcoming bull run is the recent announcement by the crypto derivatives exchange, FTX, which added Bitcoin options trading last Saturday, January 11th. Due to the increased demand, CME had also filed to double its monthly BTC futures open positions limit to 10,000 BTC in September of previous year. In addition to that, the firm plans to introduce a market maker program to support the on-screen market development of BTC futures options. He further explained that a lot of companies who use futures contracts, look to use strategies unique to option trading.

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However, there is one overlooked data point that sums up bitcoin's tremendous 2019 better than any other. On Tuesday, the world's leading cryptocurrency hit a two-month high of US$8,745, rocketing 8% in just under 24 hours.

CME Group's Bitcoin options got off to a good start this week with US$2.3 million traded on the first day, eclipsing the slow start made by rival exchange Bakkt.

According to data from Skew Research, Bitcoin is now off to the best start to a year since 2012.

The CME options contract is based on the liquid Bitcoin futures (BTC) contract, which has continued to see growing adoption and customer interest since its December 2017 launch. On December 16, 2019, Bakkt managed to trade more than 2000 contracts, which remains the highest daily volume for the recently launched product.

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