What the bitcoin derivative markets are telling us

Quick Take

  • Both Grayscale’s bitcoin trust product and CME Group bitcoin futures are driving yearly highs in volume, a sign of increased institutional demand
  • CME Group is seeing 250% growth in monthly average contracts sold Y/Y
  • While bitcoin futures notional value cracked $1 billion, it still only made up ~2.5% of gold futures notional value that day (an all-time high)
  • Given the recent spike in volatility, options platform Deribit is currently pricing a ~50% implied probability of bitcoin price ending the year at or above $10,000, up from 20% at the end of April

Macro Update

Earlier this week our research highlighted institutional flows into the Grayscale Bitcoin Trust (only qualified accredited investors can invest directly in GBTC with a minimum investment of $50,000) reaching an all-time high. New data from both the CME Group and bitcoin ETP provider Coinshares (Bitcoin XBTE – Euro) reaffirms outsized demand from institutional/accredited investors for bitcoin financial products.