RATE Group | Record CME BTC Open Interest Shows Institutions Bullish on Bitcoin Price
88557
post-template-default,single,single-post,postid-88557,single-format-standard,ajax_fade,page_not_loaded,,qode_grid_1300,side_area_uncovered_from_content,footer_responsive_adv,qode-content-sidebar-responsive,qode-child-theme-ver-1.0.0,qode-theme-ver-13.3,qode-theme-bridge,wpb-js-composer js-comp-ver-7.9,vc_responsive
 

Record CME BTC Open Interest Shows Institutions Bullish on Bitcoin Price

18 May Record CME BTC Open Interest Shows Institutions Bullish on Bitcoin Price

Posted at 04:19h in Bitcoin News by

Bitcoin’s (BTC) options markets are finally taking off at CME. This week Cointelegraph reported that the combined volume traded over the last ten days surpassed $140 million, as institutional investors delved in call options.

The buyer of a call option can acquire Bitcoin for a fixed price on a predetermined date. For that privilege, this investor pays an upfront premium for the call option seller.

CME Bitcoin Options Volumes - USD. Source: Skew

CME Bitcoin Options Volumes – USD. Source: Skew

As halving uncertainties became less of a risk, institutional investors began mounting bullish positions. Despite being more complicated then futures trading, options markets allow investors to leverage their positions without liquidation risk.

Open interest is a more relevant metric

In simple terms, open interest is the total number of contracts held by market participants. Imagine a scenario where $70 million worth of call options are traded one week and reverted on the following one. Both the buyer and seller would be closing out their…

Source link

Tags:
, , , , , , , , ,