Bakkt Bitcoin Physical Delivery at its Lowest in 2020 in Contrast to Trading Volume & OI

Despite the volatility in the bitcoin market, the futures curve is in contango indicating the selloff was “likely used as an opportunity to re-establish longs at better levels.”

Bitcoin is immensely bullish with price making big splashes and the number of active bitcoin addresses (7-day average) surpassing 1 million, the largest addresses recorded since January 2018.

These active addresses jumped while the price of bitcoin is making its way back to $11,400 after it plunged to about $10,350 over the weekend within half an hour of hitting a new 2020 high of $12,112.

This volatility resulted in $1.1 billion worth of futures positions of over 70,000 traders getting liquidated across all exchanges on Sunday.

However, “despite the aforementioned volatility in the market, the futures curve was again seen following a contango term structure, indicating leverage interest, with the selloff likely used as an opportunity to re-establish longs at better levels,” said Denis Vinokourov of Bequant.

The price action in the bitcoin market is helping Intercontinental Exchange-backed Bakkt gain institutional investors’ interest back.

As we reported, last week, twice in a row, the platform made new all-time highs in trading volume.

On July 28, Bakkt bitcoin futures reached a new record high of 11,509 contracts, which was an increase of 85% from their last record-setting day. That day, the largest cryptocurrency broke above $11,000.

The next day, Bakkt broke into yet another new all-time high with 11,706 Bitcoin Futures, worth over $125 million.

Open interest on Bakkt has also made good progress, going from $3.7 million on July 16 to $24 million on July 31st, as per Skew.

In complete contrast to all the excitement trading volume and open interest is enjoying, the physical delivery of BTC, a facet that differentiates Bakkt from its counterparts, fell. The exchange had its lowest physical delivery in 2020.

“The amount of BTC futures contracts held to expiry crashed down 74% in July, to 58 BTC. This is the lowest amount held to expiry so far in 2020,” noted Arcane Research.

Just last month, Bakkt had the third-highest delivery at 221 BTC — 293 BTC in March and 230 in January are the two biggest months since its launch in September 2019. The only time with less than these futures contracts were held to expire was in the first three months, October, November, and December at 15, 17, and 8 BTC.

Meanwhile, bitcoin options remain a disappointment as for more than a month now, $0 has been traded in Bakkt bitcoin options, and the same is the case for its OI. Its competitor CME, however, recorded $60 million in bitcoin options on July 28th and $275 million in OI on July 30th.

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AnTy
AnTy
AnTy has been involved in the crypto space full-time for over two years now. Before her blockchain beginnings, she worked with the NGO, Doctor Without Borders as a fundraiser and since then exploring, reading, and creating for different industry segments.

[Alert] Use the author's self-conducted information at your own risk, do you own research, never invest more than you are willing to lose.

[Disclosure] The published news and content on BitcoinExchangeGuide should never be used or taken as financial investment advice. Understand trading cryptocurrencies is a very high-risk activity which can result in significant losses. Editorial Policy \\ Investment Disclaimer

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