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- The CME recorded an all-time high of US$13.15 billion in Bitcoin futures trading volume, reflecting Bitcoin’s increasing popularity in financial markets following Trump’s re-election.
- Bitcoin’s price surged past US$75,000 after the election, fueling demand, with the CME’s basis—measuring spot-to-futures price gaps—rising sharply from 7% to over 15%, signaling strong interest among US institutional investors.
- The Bitcoin options market anticipates further gains, targeting $80,000 as November contracts approach expiration, supported by hopes for regulatory easing under Trump’s administration.
Yesterday, the Chicago Mercantile Exchange (CME) witnessed a record US$13.15B (AU$19.72B) in trading volume for Bitcoin (BTC) futures, a clear sign of the growing traction Bitcoin is gaining in financial markets.
The reason is evident. Donald Trump’s re-election caused a boom in the Bitcoin price, which broke past US$75K shortly after the US election results.
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Bitcoin Futures on the Rise
Throughout 2024, CME’s Bitcoin futures have seen an average daily trading volume of US$4.56B (AU$6.84B), a notable increase over past records, including the surge that followed the FTX collapse in November 2022.
The response in the derivatives market has been swift, reflecting increased risk appetite among traders.
According to Vetle Lunde, head of research at K33 Research, the CME’s basis—a measure of the gap between the spot price and futures contracts—spiked from 7% to over 15% within a day, suggesting a stronger demand for Bitcoin futures —particularly among US-based institutional investors who use the CME’s offerings to participate in bullish market moves.
Offshore traders also showed enthusiasm, as perpetual futures, a popular choice for these investors, now reflect higher premiums over spot prices, indicating an interest in leveraged exposure.
Regulatory Flexibility Ahead?
The Bitcoin options market is expected to achieve new gains as contracts expire in late November, with many contracts targeting a BTC price of over US$80K (AU$120K). This is because the market seems encouraged by the possibility of regulatory relaxation, with crypto backers hoping Trump’s administration will be less stringent than the previous one.
Michael Safai, co-founder of trading firm Dexterity Capital, highlighted the optimism surrounding potential policy shifts with Trump in the White House.
Trump brings the promise of decreased regulatory intervention in the US, which crypto investors have been howling for the past few years.
Michael Safai, co-founder of trading firm Dexterity Capital
Related: Bitcoin Hits New All-Time Highs as Donald Trump Returns to White House