Bitcoin derivatives market is growing faster than spot market, suggesting rising institutionalization in the space
June 5, 2020, 8:30AM EDT
1 min read
The bitcoin derivatives market, or futures and options, is growing faster than the spot market, according to research conducted by The Block’s Larry Cermak.
The trend, which is common in traditional financial markets such as forex, suggests that the crypto space is increasingly getting institutionalized.
Last month, both bitcoin futures and options hit yearly highs. The former saw volumes of $558 billion, while the latter saw $3.1 billion worth of trades. The legitimate spot volume, which excludes fake volumes, was about $106 billion in May.
The ratio between spot and futures volumes has increased to over 5 from less than 2.3 a year ago, indicating that futures volume is growing faster as compared to spot volume.
Cermak expects the bitcoin derivatives market to continue outpacing the spot market.
The Block Research was commissioned by Algorand to create Layer-1 Platforms: A Framework for comparison, which provides a “look under the hood” at seven platforms: Algorand, Avalanche, Binance Smart Chain, Cosmos, Ethereum/Ethereum 2.0, Polkadot, and Solana.
We assess their technical design, related ecosystem data, and qualitative factors such as key ecosystem members to get an understanding of how they differ. Having done this analysis, we draw some insights for what the future of the broader smart contract landscape could look like for years to come.