By
Bhushan Akolkar
May 7th, 2024
CBOE, the predominant US derivatives exchange that provides Bitcoin futures contracts, passed through the highest trading volume for bitcoin futures. On Wednesday, the volume was nearly three times the average daily volume.
On Wednesday, the largest U.S. options exchange CBOE saw its highest-ever volume for bitcoin futures as well as CME, the world’s leading marketplace.
Cboe Global Markets, Inc. is one of the world’s largest exchange holding companies, offering cutting-edge trading and investment solutions to investors around the world. The company is committed to relentless innovation, connecting global markets with world-class technology, and providing seamless solutions that enhance the customer experience. Cboe’s trading venues include the largest options exchange in the U.S. and the largest stock exchange by value traded in Europe.
Bitcoin futures are available for trading on the Cboe Futures Exchange, LLC (CFE) since December, 10, when CFE launched trading in Cboe bitcoin futures under the ticker symbol “XBT”. CBOE became the first exchange to introduce bitcoin futures and offer an opportunity for investors to embrace the digital currency market via a regulated platform.
XBT futures are cash-settled contracts based on the Gemini’s auction price for bitcoin, denominated in U.S. dollars. Numerous benefits broght by XBT futures to traders include transparency, efficient price discovery, deep liquidity and centralized clearing. XBT future provide a centralized marketplace for participants to trade based on their view of bitcoin prices, gain exposure to bitcoin prices or hedge their existing bitcoin positions.
April settlement of Cboe Bitcoin Futures, which is the fourth settlement since tha bitcoin futures launch, was announced on April, 18. The settlement price was $8,055.68. As of April 18, 2018, more than 557,000 contracts have traded across expiries since the launch, representing a notional value of over $5.7 billion.
On Wednesday, trading volume for bitcoin futures was the highest among the past several days. On Monday, XBT Bitcoin Futures traded at 3,881, rising to 6,653 on Tuesday. On Thursday, volume was reported at 5,634 contracts as of press time.
CBOE Options Institute senior instructor Kevin Davitt said on Thursday that “the average daily volume (ADV) runs about 6,600 in XBT Bitcoin Futures. Yesterday’s volume was nearly three times ADV.”
He explained: “Yesterday was the highest daily volume for bitcoin futures since their introduction here at CBOE nearly five months ago. The lead month May futures traded 18,210 contracts, and across the term structure a total of 19,000 bitcoin futures traded here yesterday. The previous high-volume session was January 17 with just less than 15,500 contracts traded.”
Davitt noted that “the overall bullish sentiment continues in XBT Bitcoin Futures” and said: “We will certainly be watching to see if this is a volume aberration or if more and more institutional types are moving into crypto.”
Recently, CBOE said that they want to change the way of pricing bitcoin futures contracts. In a letter to the Commodity Futures Trading Commission (CFTC) dated April 17, CBOE Future Exchange (CFE) managing director Matthew McFarland announced a proposed rule amendment that would lower the minimum increment on its futures contracts from 10 points (worth $10) to 5 points (worth $5) sometime on or after May 1.
The change would apply to single leg transaction, meaning those involving only one contract, and not spread traders, which require an investor to buy and sell two different contracts simultaneously.
As for Bitcoin, digital currency number one, its current price is $9 372,43, according to CoinMarketCap.