The launch of new Bitcoin-related contracts on the world’s largest derivatives market, the Chicago Mercantile Exchange, recently has been attracting huge interest from institutional investors, as per JP Morgan Chase.
A note written by strategists like Nikolaos Panigirtzoglou on 10th January stated that the volumes and open interest from Bakkt’s offering of options had been relatively “small.” Concerning the strength of CME in trading Bitcoin futures on regulated exchanges, they said that this new offering might change things.
As written by the Managing Director at JP Morgan, Nikolaos Panigirtzoglou, the activities with regards to CME futures contract has increased drastically with relatively 69 percent open-interest by the end of the financial year. This means that there is an increase in activities.
“There has been a step increase in the activity of the underlying CME futures contract” over the past few days, Panigirtzoglou wrote, “This unusually strong activity over the past few days likely reflects the high anticipation among market participants of the option contract.”
The launch of new Bitcoin contracts has a mixed reputation. Now and again, there have been speculations regarding the delay on the price hike, when ICE launched its new futures contract in September. Also, the peak price was around 19,000 dollars. In December 2017 it happened as CME and Cboe Global Markets Inc introduced futures on the world’s biggest cryptocurrency.
Moreover, the market is becoming ideal for the biggest cryptocurrency by market capitalization, Bitcoin after-hours downtrend price of 7,600 dollars level. BTC has topped advantageously above 8,000 dollars with a sign of further price growth.
Gradually, Bitcoin’s intrinsic value was going up, yet stays below the market price, later a noteworthy difference in the mid last year as indicated by the report. JP Morgan ascertains the intrinsic value by taking Bitcoin as a commodity and by looking at the marginal cost of production which includes computational power employed and cost of power.