The value of traded positions went from approximately 500 BTC to more than 1,000 BTC in October. Bitcoin futures show a growing interest among institutional investors.
The open interest in Bitcoin futures in CME grows again after a fall at the beginning of October. During the first weeks of the month, investments in these types of contracts in the Chicago Mercantile Exchange (CME) market have increased steadily. This is revealed by data from the analysis firm Skew, published on October 20th.
In a graph published by Skew through Twitter, the rise in the value of Bitcoin futures contracts of institutional accounts, which represent long positions, can be seen. The figures related to open interest exceed the equivalent of 1,000 BTC, after the amount was around 500 BTC at the beginning of the month.
The term “open interest” refers to the total number of options or future contracts that have not been closed at any given time. It is also the number of purchase orders that remain open in the stock market before a session starts.
The Skew chart shows that at the beginning of October the open interest in CME fell below 500 BTC. However, during August, trades had progressively increased. At the end of September, open interest figures remained above 1,000 BTC, as can be seen in the same publication.
In the tweet, the firm adds that the term “institutional accounts” refers to pension funds, insurance companies and equity funds, among other accounts whose majority investment is of institutional origin.
Growing Interest in Institutional Investment in Bitcoin
It can be seen that institutional interest in Bitcoin products shows signs of having grown. In fact, the October figures for CME seem to correspond with the intention of the institutional sector to invest in Bitcoin and other cryptocurrencies.
This scenario was reflected in the results of a survey published at the beginning of May this year. According to the consultation, which was sponsored by Fidelity Investments, about 50% of institutional investors consider cryptocurrencies to be a good investment opportunity.
From those who were consulted at that time, more than 20% already had investments in various cryptocurrencies. On the other hand, 72% of the persons interviewed expressed their preference to invest in products derived from cryptocurrencies.
New Boost to Bitcoin Futures Contracts
This growth in CME futures contracts has also been observed in another of the Bitcoin futures providers, namely the most recent case of the launch of BTC futures contracts in Bakkt.
After experiencing a slow start in relation to the expectations generated by the market, reports from the financial products firm and independent organizations registered an increase in the interest in Bakkt’s Bitcoin futures contracts.
With regard to CME, record figures of open interest positions for its Bitcoin futures were recorded last July. In addition, nearly 1,000 new accounts had already been opened on the platform. This figure represented at that time an increase close to 30% with respect to the total number of accounts existing in the CME platform.
By Willmen Blanco