Open interest in the Chicago Mercantile Exchange (CME) Bitcoin futures has reached all-time highs of $ 976 million. All this, amid an increase in institutional capital inflows to Bitcoin.
Precisely, the increase in the price of the cryptocurrency since the beginning of the month, has increased the open interest in the Bitcoin futures market. With an aggregate OI reaching $ 6.29 billion on Monday.
The open interest index of Bitcoin futures
To better understand, open interest is the total number of contracts that remain open at the end of the trading session.
Therefore, since there is a buyer and a seller in each transaction, the open interest is the total of positions up or down that remain open but not the sum of both.
It should be noted, that open interest in the CME Group Bitcoin futures market reached its highest level since mid-August.
As is known, Stanley Druckenmiller and Bill Miller, expressed optimistic views on Bitcoin.
Basically, the previous record of $ 948 million came shortly after Paul Tudor Jones said that he owns Bitcoin and plans to take positions in Bitcoin futures.
Indeed, the data of the research firm Skew show that traders in the futures market have taken note of the low volatility in the price of Bitcoin.
As a consequence, they have opened a large number of positions that shows the expectation about a possible movement in the price of Bitcoin located at $ 5 trillion. This is an indicator of an increase in Bitcoin volatility in the short term.
Growth in the market
Incidentally, a Bitcoin spokesperson for the Chicago Mercantile Exchange (CME) stated: “The number of large open interest holders (LOIH) is once again at a record 102 holders. And we’re averaging 101 headlines so far in November. “
According to CME, LOIHs are entities that have more than 25 CME Bitcoin futures contracts, and each contract contains 5 Bitcoin.
In this regard, the CME surge in Bitcoin futures positions also comes as BitMEX and Huobi face ongoing regulatory challenges. Also, a flat or decreasing open interest during the third and fourth quarters.
The views of Stanley Druckenmiller and Bill Miller
Certainly, Druckenmiller said on CNBC, that he owns Bitcoin. Becoming the latest high profile, high net worth investor to enter the benchmark digital currency.
For his part, veteran investor Bill Miller, also on CNBC, indicated that all large investment banks will own Bitcoin. Or something similar.
«The history of Bitcoin is very easy. It is supply and demand. The supply of Bitcoin grows around 2.5% a year and the demand grows faster than that«.
Paul Tudor Jones expressed that he owns Bitcoin
Paul Tudor Jones II, a pioneer of the modern hedge fund industry, confirmed that he has invested between 1% and 2% of his assets in Bitcoin.
«We are seeing the birth of a store of value, and whether or not that succeeds, only time will tell.«.
Without a doubt, it should come as no surprise that open interest has skyrocketed in line with the price of Bitcoin. Since the value of the negotiated contracts is directly linked to the price of the underlying product.
In closing, what do you think about the recent surge in CME’s Bitcoin futures open interest? Leave us your opinion in the comment box.
I retire with this phrase from Publilio Siro: “Things are worth what one is willing to pay for them”.