Binance Futures Trading Volume Surpasses Spot BTC Volume While Bakkt Means “Institutions Will Trickle In”
- “Talk about demand and fast-up take,” Binance CEO on Binance futures performance
- Lacklustre performance of Bakkt
- Don’t be fooled by the dump, $7,500 is the “opportunity of a lifetime”
Binance futures continues to grow at a rapid pace as its trading volume exceeds spot Bitcoin volume at times, shared CEO Changpeng Zhao.
In the past 24 hours, the volume traded on the Bitcoin futures platform of the leading cryptocurrency exchange Binance was $700 million versus $800 million recorded on its spot exchange.
“Talk about demand and fast-up take,” Zhao said while adding, “The product also handled the large volatility with no significant issues. First live test.”
CZ’s comments came after a user took to Twitter to share the data stating that 75,000 BTC was traded on Binance futures platform with no auto-deleverage being triggered. The user further continued by laying out that risk engine was processing error free while matching engine was working as designed that is running fast.
Another ATH yesterday – 75k BTC being traded, no auto-deleverage was trigged, risk engine was processing error freely, matching engine was running fast as it is designed.
We are on the right track. 💪 pic.twitter.com/Pg6N5PiArE
— Aaron Gong (@AG_Binance) September 25, 2019
Just about two weeks back, Binance launched its futures platform, that allows speculators to bet on BTC price whether it is going up or down. It made a good start, trading $170 mln with a maximum leverage of 20x.
Lacklustre performance of Bakkt
However, competition in the digital asset futures market is stiff, more so with the launch of Bakkt that offers the physical delivery of daily and monthly bitcoin futures for institutional investors.
However, Bakkt recorded a volume of mere 72 BTC on its first day. In comparison to CME’s — that launched BTC futures in December 2017 — the volume of 5,298 BTC, this figure was meager.
Cboe, CME, Bakkt volumes on the first day of trading. pic.twitter.com/vHoN9Mhr5l
— Unfolded (@cryptounfolded) September 24, 2019
Despite this 75x difference, there’s a key difference between the Bitcoin futures contract on both the platform. Unlike CME, Bakkt settles contracts with physical Bitcoin.
The infrastructure of the recently released platform is also likely to become fundamental to reliable price discovery as well.
Price discovery unfolding before our eyes
On our second day of operations, totally transparent trading in monthly Bakkt Futures Contracts shows Bitcoin ending the day at $8,560 on 166 lots changing handshttps://t.co/QRpGj5wV4M
— Bakkt (@Bakkt) September 24, 2019
“Don’t overlook today,” Michael Sonnenshein, managing director of Grayscale Invest adding, “This is an important development for the maturation of the $BTC market.”
Su Zhu, CEO and co-founder of the investment firm Three Arrows Capital, shares similar views. “Bakkt will be likely first a trickle and then a flood,” he wrote.
Don’t be fooled by the Dump, $7,500 is the “opportunity of a lifetime”
However, much-anticipated launch of Bakkt saw BTC price free falling to $8,025 level which eToro analyst, Mati Greenspan says is the case of ‘buy the rumor, sell the news’ at a “very large scale.”
Does this mean, Bakkt was over-hyped? Economist and trader Alex Kruger says, that’s “debatable” as the platform is giving institutions a venue to trade and hold physical bitcoin.
“(Bakkt) It's a door. It's now open. Institutions will trickle in,” he added.
Trader Crypto squeeze also says, “Bakkt is great for further institutional adoption for Bitcoin in long term.”
He warns investors to not be fooled by the short dump thinking that Bitcoin will make a repeat like 2017 when CME launched BTC futures. Bitcoin, according to him is not going to $3,000, rather a chance to buy BTC at around $7,500 is the “opportunity of a lifetime.”