CME BTC Futures Volumes Hits 4-Month Low: Analysis

CME BTC futures volumes reached the lowest point in four months, getting 50% below than peak activity in July as we reported in the previous altcoin news. The futures market behavior was seen as an indicator for the weakening bitcoin performance.

The futures market reached the lowest volumes in four months just when BTC broke down below the $10,000 again failing to perform a better rally. BTC dropped below $9,896 after a one-hour crash early on Thursday. The futures markets indicate that there are two moods and attempts to sway the BTC market since the launch of the cash-settled futures was seen as potentially setting off a long drop in BTC prices in 2018. The CME BTC futures volumes activity also correlates with the imminent launch of the BAKKT ICE futures market. this time, there are a lot of questions on how the product will affect the BTC spot prices. Bakkt will use a physical delivery settlement instead of cash ones. The sentiment surrounding the BTC prices is showing a ‘’fear’’ more and at this point, it is still unknown which investors will enter the futures markets and according  to some analysts:

 ‘’ of a 2nd example of my fear. The out of no where dump in bitcoin on 9/6, it started at 1pm. The Bitcoin futures dump started at 1235pm on the CME futures. It seems to me bitcoin is now controlled the way equities markets are: by a small minority trading in an illiquid futures mkt’’

It is still unclear whether the new Bakkt futures would have a similar effect since, in theory, the traders could acquire physical BTC by acquiring a contract and holding it until the settlement begins. They will be credited with the actual BTC later. Despite the low volumes, the CME increased the spot-month position limits and BTC still remains unpredictable so it is possible that there is some more increasing interest in trading.  As per the latest cryptocurrency news, the CME futures market seems to be active in comparison to the CBOE product which was eventually discontinued before the big summer rally which sent BTC to a yearly peak.