Bitcoin (BTC) futures for December 2021 are trading around $10,000 above the current BTC spot price, according to data from Skew.
With the aggregate value of all Bitcoin futures reaching $14 billion last week, it’s safe to say that cryptocurrency derivatives are gaining significant interest.
A futures contract allows its owner to purchase the underlying asset at a pre-agreed price at some specified time in the future, similar to an options contract. However, with futures, the holder is obligated to make the purchase.
Futures contracts are intended to protect oneself against future price fluctuations, but naturally, these contracts can also be traded by speculators.
Crypto futures are only available on certain exchanges. Users can trade futures on popular Bitcoin platforms like Binance, Kraken, and Bitfinex.
Institutional-grade exchanges offering crypto futures, such as the Chicago Mercantile Exchange (CME), or Bakkt, owned by the Intercontinental Exchange (ICE), enable professional traders to engage with the crypto markets while reducing the effects of potential volatility
FTX and CoinFlex, are currently the only two that offer futures contracts as far as December 2021. As of writing, CoinFlex was offering the higher figure between the two exchanges at $60,250. December 2021 BTC futures on FTX were trading at $58,750 but had earlier peaked at $61,850.
Another exchange, Deribit, offered BTC futures for September 2021 at $56,200. However, most exchanges where crypto futures are available only offer futures as far ahead as July 2021, according to exchange data aggregated by Skew.
Today, Feb 16, BTC breached $50,000 for the first time. This is largely due to growing institutional Bitcoin demand, especially Elon Musk’s $1.5 billion BTC purchase. If it continues rising at a similar rate as the crypto community has previously seen, $60,000 may seem like a steal.
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