Since its launch two months ago, Bakkt Bitcoin Futures have been breaking records reaching an all-time high of 4,443 contracts traded today-representing 60% increase from the last trading day. Bakkt has been able to achieve this substantial milestone trading 2, 000 BTC per day despite a poor run of BTC price.
Data from the Intercontinental Exchange(ICE) points out that more than $20.3 million was traded in Bitcoin last Friday. The firm also added that Bakkt was on a bullish trend leading to the launch of Bitcoin options contracts on December 9. The new trading volume represents a 66% increase over the previous day and is roughly 30% higher compared to the previous all-time high reached on November 8.
Following a slow start in September, the volumes of Bakkt’s physically settled BTC futures have been increasing gradually. The new trading record set by Bakkt coincides with a significant fall in Bitcoin prices to $7, 000 on Friday, November 22, for the first time in over five months. The new Bakkt record amidst declining Bitcoin prices is a clear indication of growing institutional interest in digital assets.
Institutions Key to Bakkt’s High Volumes
Bakkt’s relatively high volumes are due to institutions’ interest in Bitcoin. Skew Markets found that institutional longs on the Chicago Mercantile Exchange’s Bitcoin futures market hit a one-month high, reaching around 1,300 BTC worth of contracts. This figure is up by five times from the 250 BTC reached in late September. Skew also added that institutions are currently net long 880 BTC contracts, compared to 660 BTC from the previous week. Short positions have fallen as institutions are experiencing a breakout in the upward direction.
While some crypto trader maintains that institutions have in-depth knowledge in Bitcoin’s directionality compared to retail investors, this claim may be untrue. Recently, an established crypto trader Romano stated that institutions using the CME” have a good track record for the right directional trade,” having shorted BTC ahead of the Bakkt launch and the subsequent crash.
With growing institutional interest, Bakkt has embarked on expanding its line of Bitcoin-related products, and the trading volume is expected to rise again. Bakkt also made it clear that Bitcoin futures contracts will be offered on ICE Futures Singapore from December 9. The same date will also see the launch of the first regulated options contract for Bitcoin.