The Chicago Mercantile Exchange (CME) will launch options on Bitcoin futures starting yesterday. This comes as a result of the increased interest in cryptocurrencies. Additionally, JP Morgan analysts believe there is great anticipation among institutional investors for CME's newest product.
CME recently announced the launch of its new product, which will allow clients to trade options on Bitcoin futures. Its launch was scheduled for yesterday, January 13th. Some believe it will attract more attention from institutional investors. In fact, a group of analysts from JP Morgan, led by Nikolaos Panigirtzoglou, shared their views on the matter. They noted that overall interest in CME has grown by almost 70% since the end of last year.
[amazon box="B07M6R4NK3"]Anticipating CME's Bitcoin Futures Options
The group chaired by Nikolaos expressed that this could come as a result of the options contracts:
“There has been a gradual increase in activity on the underlying CME futures contract. This unusually strong activity over the past few days likely reflects the high anticipation among market participants for the option contract.”
It's worth noting that Bakkt , the Bitcoin futures trading platform of the Intercontinental Exchange (ICE), previously launched monthly Bitcoin options. Panigirtzoglou acknowledges this but doesn't consider Bakkt's volume sufficient at the moment, calling it "quite small." Researchers believe that since CME has been more dominant in the futures market, its Bitcoin options will have a more significant impact.
Another Bitcoin options product came from the large cryptocurrency derivatives platform FTX . According to the company's CEO, it launched on January 11th and quickly reached $1 million in volume in just two hours.
Bitcoin price reaction to come?
The largest cryptocurrency has been on a volatile journey since the beginning of 2020. Historically, it has shown reactions whenever similar products were launched. For example, just one day after Bakkt's Bitcoin futures trading platform saw the light of day, the price of BTC plummeted by more than $ 1 in a matter of hours.
At the time of writing, Bitcoin is trading at $ 8, which is slightly above the first support line of $ 060. If this level does not hold, a lower support can be expected at $ 8 and $ 000. 7. However, if BTC continues to rise, the first resistance line it would have to break above is $ 700 and then $ 7.
