bitcoin futures

Vaneck Bitcoin Futures ETF Gets Green Light from SEC — Fund to Join Proshares BTC ETF Listing on NYSE

October 20, 2021 Bitcoin.com

VanEck Bitcoin Strategy ETF will likely launch next week as crypto prices reach ATHs

October 20, 2021 Coin Telegraph

Bitcoin

The asset manager could be the first to follow ProShares, which listed its Bitcoin Strategy ETF on the New York Stock Exchange on Monday.

The United States Securities and Exchange Commission, or SEC, has likely approved asset manager VanEck’s Bitcoin Strategy exchange-traded fund (ETF), with trading expected to begin on Monday.

In a Wednesday filing with the SEC, VanEck said the public offering of its Bitcoin (BTC) Strategy ETF, which offers exposure to the crypto asset through futures contracts, would begin “as soon as practicable” after the effective date of the filing, Saturday. This suggests the company could list its shares on an exchange as early as Monday.

Unlike exchange-traded funds offering direct exposure to BTC or Ether (ETH) — which the SEC has not approved — VanEck’s ETF would provide exposure through cash-settled BTC future contracts traded on exchanges registered with the Commodity Futures Trading Commission, pooled investment vehicles, and other exchange-traded products. Having first applied for the BTC futures-linked ETF in August, VanEck could follow ProShares, which on Monday launched its Bitcoin Strategy ETF on the New York Stock Exchange.

The potential VanEck ETF listing comes as BTC and ETH prices reached new all-time highs . According to data from Cointelegraph Markets Pro, the prices of BTC and ETH are $65,955 and $4,003, respectively.

This story is developing and may be updated.

BTC Futures Open Interest Soars Leading up to Bitcoin ETF’s Official Launch

October 19, 2021 Bitcoin.com

Here’s why analysts are saying ‘No FOMO’ ahead of Bitcoin’s ETF launch

October 18, 2021 Coin Telegraph

bitcoin futures

The upcoming launch of a BTC ETF has bulls proclaiming that a $100,000 Bitcoin price is imminent, but several analysts warn that a sharp short-term pullback could also occur.

The day the crypto traders have long-awaited is almost here. At the opening bell on Oct. 19, a ProShares futures-based BTC ETF is scheduled to launch and analysts are predicting that additional ETFs will rollout over the coming week.

Data from Cointelegraph Markets Pro and TradingView shows that an early morning attempt by bears to drop the price back below $60,000 was well defended by traders and at the time of writing their is a tug-o-war at the $61,000 to $62,000 zone.

*BTC/USDT 1-day chart. Source:* *TradingView*

While many have predicted that the ETF launch is the fuel needed to push BTC to the $100,000 mark, not all analysts agree and some warn that the event could be another “buy the rumor, sell the news” event.

A higher low would be "normal" price action

One trader who is not completely enamored with the idea of a BTC futures ETF is pseudonymous Twitter user ‘Cry me a $COIN’, who posted the following tweet suggesting that the recent BTC price action is merely part of a normal price cycle.

I don't like the "ETF will be/has been approved. WAGMI" vibe.

Don't be surprised with a higher low. It will change nothing, and that is the beauty of it.$BTC pic.twitter.com/HJ6GyZtaMr
— cry me a $COIN (@crymeaCOIN) October 17, 2021

According to the price path outlined in the chart above, there’s a chance that Bitcoin tops out below $68,000 in the next few months before heading lower to establish a higher low near $46,000.

A similar sentiment was expressed by 'Ryan Cantering Clark’, who suggested that up to now, “the trade has been "long ETF approval" and we are here, so what else in the short term takes us much higher?”

Clark said:

“Everyone knows where this is going, so in the short term I think we get a deeper pullback.”

FOMO buyers beware

A deeper analysis of what could possibly come next was provided by David Lifchitz, managing partner and chief investment officer at ExoAlpha. Lifchitz suggested that a small pullback might be in order, “especially after the torrid run from $40,000 just two weeks ago,” which translated into a BTC increase of 50%.

While Lifchitz suggested that “the medium-term looks definitely higher,” the analyst offered a word of caution for potential buyers by saying, “these Bitcoin ETFs based on CME futures to track BTC price will underperform Bitcoin spot price due to ongoing futures roll costs.”

According to Lifchitz, professional traders are likely to continue using Bitcoin CME futures or crypto derivative exchanges for their trading needs while “long-time crypto investors are all well equipped to directly trade and store Bitcoin spot.”

Lifchitz said:

“So these ETFs will likely be an easy Bitcoin access to unsophisticated retail investors with their broker accounts, who will not get the full return of BTC after all fees are accounted for. These ETFs will also bring arbitrage opportunities for smart traders. Wall Street at its best.”

$90K BTC price if the classic cup and handle formation plays out

A final scenario to be on the lookout for was offered by pseudonymous Twitter user ‘Nunya Bizniz’, who posted the following tweet outlining a bullish scenario for Bitcoin’s price action.

BTC daily:

"IF" there is going to be a correction, perhaps something like this?

Giant cup and handle.

What do you think? pic.twitter.com/LPSQ0320zl
— Nunya Bizniz (@Pladizow) October 18, 2021

As seen in the chart provided, the analyst suggested that BTC price has the potential to drop back to the $53,000 support in the near term before resuming its uptrend.

The trader believes that after the price pulls back to touch underlying support, BTC could then squeeze up to $98,000.

The overall cryptocurrency market cap now stands at $2.463 trillion and Bitcoin’s dominance rate is 47.3%.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

SEC Tweets About Funds Holding Bitcoin Futures — Expectations of Impending Bitcoin ETF Approval Soar

October 15, 2021 Bitcoin.com

CME Bitcoin futures open interest hits 8-month high, greater than when BTC price was at $65K

October 14, 2021 Coin Telegraph

Bitcoin

Open Interest surged to $3.22 billion Thursday to levels not seen since February.

Open interest (OI) for Bitcoin (BTC) Futures trading on the Chicago Mercantile Exchange (CME) inched toward a new record high Thursday as BTC reclaimed its five-month high of $58,550 on BitStamp.

The total number of outstanding derivatives contracts on CME Group's Bitcoin Futures market reached $3.22 billion, according to data provided by ByBt.com, just $40 million below its record high logged in Feb 2021. Nonetheless, the OI came out to be higher than it was at the Bitcoin price's peak in mid-April.

In detail, the Bitcoin Futures OI on CME was $3.02 billion on April 14, the day on which the BTC price—nearly reached $65,000. But on Thursday, the OI was more than 6% higher than the readings from mid-April, even as the BTC price wobbled inside the $57,000-$58,550 price range.

*CME Bitcoin Futures open interest. Source: ByBt.com*

Traders often use OI as an indicator to confirm trends in both derivatives and spot markets. For example, a rising number of outstanding derivatives contracts gets interpreted as new money coming into the market, irrespective of the bias.

Meanwhile, in the case of Bitcoin, a rising open interest in the futures market appears indicative of accredited investors' wanting to increase exposure to BTC.

Commercial sector increases Bitcoin Futures exposure

The latest OI readings suggest that more institutional capital is entering the Bitcoin market. As a result, investors have been looking more confident in opening new positions in the $50,000-$58,000 price range, with the CME volumes trending higher in the past seven days.

*Bitcoin futures — volume and open interest. Source: CME*

Analysts see a uniform rise across OI, volume, and price as signs of new buying in the futures market. That also puts the underlying asset in a better position to continue its uptrend. So it seems, Bitcoin is undergoing a similar upside trend.

Prime evidence for a bullish Bitcoin comes from the Commodity Futures Trading Commission's record released on Oct. 5. It notes that the commercial sector — which comprises corporate hedgers — have accelerated their Bitcoin Futures purchases; they now hold a net position of more than 10,000 BTC.

*CME BTC Futures exposure changes. Source: CFTC, Forbes*

At the same time, however, hedge funds and retail investors have emerged to be net short in the Bitcoin Futures market. Nevertheless, that could be their tactic to offset long positions elsewhere, such as in the spot market.

That is primarily due to a higher annualized premium available on CME Bitcoin Futures prices over spot markets. In recent days, CME Bitcoin futures price has been regularly trading 15% above BTC spot price, compared with around 7.7% on average in the first nine months of 2021.

*Bitcoin Futures premium against spot prices. Source: Skew*

Macro fundamentals behind Bitcoin resurgence

The latest bout of buying in the Bitcoin spot market also appeared in the wake of statements coming from U.S. regulators.

For instance, Gary Gensler, the chairman of the Securities and Exchange Commission (SEC), and Jerome Powell, the chairman of the Federal Reserve, discouraged a ban on Bitcoin. Meanwhile, the increasing prospect of a Bitcoin ETF approval by the SEC has also fueled the "buy the rumor" narrative.

Investors also sought exposure in the Bitcoin market as consumer prices continued to soar in the U.S. According to the Labor Department, the Consumer Price Index (CPI) rose to 5.4% year-over-year in September for the first time in thirteen years.

Inflation came in at 5.4% for September, which is a 13 year high.

Bitcoin just crossed over $58,000 which is the highest price since May of this year.

Bitcoin continues to serve as the best inflation hedge in the world.
— Pomp (@APompliano) October 14, 2021

JP Morgan Chase noted in its recent report that higher inflation prompted institutional investors to seek exposure in Bitcoin, with some even seeing the cryptocurrency as a better haven asset than gold. In another report published in Jan 2021, the U.S. banking giant had anticipated the BTC price to reach $140,000 in the long term.

"A crowding out of gold as an ‘alternative’ currency implies big upside for Bitcoin over the long term," it had noted.

"A convergence in volatilities between Bitcoin and gold is unlikely to happen quickly and is in our mind a multiyear process. This implies that the above-$146,000 theoretical Bitcoin price target should be considered as a long-term target, and thus an unsustainable price target for this year.”

CME Bitcoin derivative traders had ‘paper hands’ as BTC broke $55K — Report

October 7, 2021 Coin Telegraph

Bitcoin

Traders wound up their long Bitcoin derivatives contracts ahead of the October price rally, ignoring solid on-chain fundamentals.

Bitcoin (BTC) derivatives traders on the Chicago Mercantile Exchange (CME) missed out on incredible profits as BTC’s spot price smashed through $55,000 this week.

Retail investors reduced their long exposure across the Bitcoin futures and options markets in late September, according to data shared by Ecoinometrics. The amount of open short positions also climbed, indicating that derivative traders anticipated Bitcoin’s price to drop, as shown in the chart below.

*CME Bitcoin derivatives — retail traders. Source: CFTC “Commitments of Traders” report, Ecoinometrics*

The data was taken on Sept. 28, when BTC price had fallen below $41,000 on Coinbase — down almost 23% from its month-to-date high near $52,950. The drop surfaced in the aftermath of China’s decision to ban all kinds of crypto transactions.

“Most likely, this dip is due to a mix of traders not rolling their long positions to the October contract and some outright liquidating when BTC looked like it was going to drop below $40k last week,” said Nick, an analyst at Ecoinometrics.

“Regardless, the overall picture is that the futures traders lack conviction.”

“That’s paper hands 101,” the analyst noted.

Smart money

Institutional investors in the CME Bitcoin futures market also followed retail sentiment as they reduced their long exposure in the market. But, on the other hand, their short positions climbed.

With CME options traders convinced that Bitcoin price would drop, the number of puts — an implicitly bearish bet on Bitcoin’s price — turned out to be almost twice the size of the calls, or bets on potential Bitcoin price gains.

*CME Bitcoin options — puts vs. calls open interest. Source: Ecoinometrics*

Traders’ position distribution made $40,000 the most sought-after strike price target.

On the other hand, some options traders bet that the spot Bitcoin price would hit $60,000 by the end of October. Additionally, analyst Crypto Hedger highlighted that Bitcoin options expiring on Nov. 26 show bulls’ sentiment skewed toward the $80,000-strike target.

*Buy/sell volume in the last 24 hours for Nov. 26 Bitcoin options contract. Source: Laevitas, Crypto Hedger*

“At this current growth pace, Bitcoin has formed very strong support at the $50,000 price point, and short-term traders may also need to watch out for the key resistance level around $56,000,” said Konstantin Anissimov, executive director of CEX.IO, adding:

“A break below or above these levels can stir another cataclysmic price reversal or a massive run toward $60,000 in Q4.”

Bitcoin supply squeeze in play

On-chain data shared by Ecoinometrics also showed a higher level of Bitcoin withdrawals from all the crypto exchanges.

In detail, Bitcoin’s 30-day net exchange flow has been rising since July 2020, as noted in the color-coded chart below, with blue and red indicating extreme outflow and inflow, respectively.

*Bitcoin rolling net exchange flow. Source: Coinmetrics*

Ecoinometrics noted that the amount of Bitcoin currently leaving exchanges is higher than it was in the previous four-year halving cycles.

*Bitcoin rolling net exchange inflow (second halving vs. third). Source: Coinmetrics*

Meanwhile, traders see the reduction in Bitcoin’s supply on exchanges, with increasing “hodling” activity, as further catalysts for a liquidity crisis and more price upside.

“Back then there were indeed periods of net outflows but in terms of size they look much less dramatic than what we have right now,” Ecoinometrics highlighted, adding:

“That’s another sign that we are on course for a liquidity crisis which could drive Bitcoin’s value much higher than it is right now.”

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk, and you should conduct your own research when making a decision.

SEC Chairman Gary Gensler Looks Forward to Review of Bitcoin Futures ETF Filings

October 1, 2021 Bitcoin.com

BlackRock SEC filings show company gained $369K from Bitcoin futures

September 28, 2021 Coin Telegraph

BlackRock SEC filings show company gained 9K from Bitcoin futures

Adoption

Larry Fink, chief executive officer of BlackRock, said in July that the company was seeing "very little in terms of investor demand" for cryptocurrencies.

A filing from the United States Securities and Exchange Commission, or SEC, shows that BlackRock Financial Management has increased the number of its Bitcoin futures contracts since Q1 2021.

According to a Tuesday filing with the SEC, the BlackRock Global Allocation Fund included 54 Bitcoin (BTC) futures contracts issued through the Chicago Mercantile Exchange as of July 31. The contracts, which expired on Aug. 27, were worth $10.8 million, appreciating by $369,137.

The gains from the Bitcoin futures represent roughly 0.00138% of the BlackRock Global Allocation Fund, or 8.91 BTC at the time of publication. The company holds $9.5 trillion in total assets under management.

The investment comes following BlackRock chief intelligence officer Rick Rieder saying earlier this year that the firm had “started to dabble a bit” in crypto. However, CEO Larry Fink said in July that the company was seeing “very little in terms of investor demand” for cryptocurrencies.

Before pursuing Bitcoin futures, BlackRock had indirect exposure to the crypto asset through its ownership stake in business intelligence firm MicroStrategy The investment company also mentioned Bitcoin in two prospectus filings with the SEC in January, hinting that it would be exploring using crypto derivatives.

News of the BlackRock SEC filing comes as the price of Bitcoin has dropped more than 4% in the last 24 hours following a month of considerable volatility. As data from Cointelegraph Markets Pro shows, the price of the crypto asset is $41,323 at the time of publication.

Genesis tests end-of-day pricing for institutional crypto futures product

September 27, 2021 Coin Telegraph

bitcoin futures

Genesis has introduced a trading method allowing institutional investors to trade Bitcoin futures contracts based on their end-of-day closing price.

Cryptocurrency brokerage firm Genesis Global Capital has announced the completion of a first-of-a-kind trade that will pave the way for new institutional crypto futures products.

Genesis has executed the first-ever over-the-counter (OTC) block trade of a Basis Trade at Index Close (BTIC) transaction using Bitcoin futures contracts issued b Chicago Mercantile Exchange (CME). The trade was made in collaboration with derivatives market maker Akuna Capital according to a Sept. 26 announcement.

This is the first time a BTIC has been used for cryptocurrencies as it is more commonly used in equities markets. This form of trading allows investors to buy and sell futures contracts with prices based on the end-of-day close of the index.

CME Group Global Head of Equity Index and Alternative Investment Products, Tim McCourt, said that the product was the next step in offering greater exposure to CME’s Bitcoin derivatives and Ethereum futures, with the Ether contracts having launched in February. He elaborated on the advantages of this new trading vehicle, explaining:

“BTIC enables market participants to more efficiently trade the basis while providing a regulated marketplace for real-time price discovery and enhanced trading precision for institutional participants who want to optimize holdings between the futures and spot markets.”

Genesis provides liquidity to CME Group for its BTC and ETH futures and options products.

In May, the CME launched micro Bitcoin futures which are contracts worth 0.1 BTC. The offering was designed to allow institutional traders to hedge their risks to crypto assets.

By the end of June, the product had surpassed a million traded contracts suggesting that there is a high demand for smaller positions in crypto among institutional investors still testing the waters. This latest product is another example of diversifying the options for well-heeled investors to gain exposure to crypto markets.

A higher low would be "normal" price action

FOMO buyers beware

$90K BTC price if the classic cup and handle formation plays out

Commercial sector increases Bitcoin Futures exposure

Macro fundamentals behind Bitcoin resurgence

Smart money

Bitcoin supply squeeze in play

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