Futures traders have jumped on the arrival of the first US spot bitcoin exchange traded funds, ramping up a lucrative bet that capitalises on the volatile moves of crypto-related prices.
The number of bitcoin futures contracts open at Chicago’s CME Group has climbed to record levels in January as traders target a short-term return from the difference between those contracts and the spot price — aping a strategy that has long been popular in more established financial and commodity markets.
The open interest marker, a sign of the depth and liquidity of a futures market, has enabled CME to leapfrog Binance as the world’s largest exchange for trading derivatives of bitcoin. While Binance has thousands of retail customers, CME has traditionally catered to big asset managers, hedge funds and proprietary traders.