The price of bitcoin (BTC) has risen once again after a successful launch of CME’s bitcoin options surpassed rival Bakkt on its BTC futures contracts in the first day of trade volume.
On Jan. 14 at around 00:30 UTC, the price of the world’s largest cryptocurrency by market value rose above an area of resistance that had stifled previous rallies near $8,200 for over a week beginning Jan. 7.
As of press time, BTC is changing hands at $8,413 after reaching its highest point in nearly two months at around $8,446, CoinDesk BPI data shows.
This comes several hours after the successful launch of Chicago-based derivatives exchange CME’s futures contracts for BTC, which surpassed rival Bakkt in reported volume within its first day of trading.
Global Head of crypto trading giant Cumberland, Chris Zuehlke said institutional investors are seeking traditional risk management tools to support greater entry into crypto.
“As with any new financial product, we expect volume will grow organically as investors get more comfortable trading it,” Zuehlke said.
An option on a futures contract gives a holder the right, but not the obligation, to buy or sell a specific futures contract at a strike price on or before the option’s expiration date.
Joshua Green, head of trading at cryptocurrency trading firm Digital Asset Capital Management, said the rise in BTC’s value was “nothing obvious” citing a potential short-squeeze.
“Maybe some negative gamma from spot moving through that strike (of $8,250) or people covering shorts that were put on in a notification of Chinese New Year sell-off,” Green said.
Justin Chow, global head of business development at Cumberland said BTC’s recent rally was being led by altcoins, specifically BTC forks such as Bitcoin SV and Bitcoin Cash.
“While the CME BTC Options launch corresponded to the move, BTC forked coins and other altcoins that have upcoming halvings are the strongest performers,” Chow said.
BSV and BCH are currently posting a 22.1 and 6.84 percent rise respectively over a 24-hour period.
Other notable cryptocurrencies are also up on BTC’s good fortune with ether and XRP both up 2.95 and 2.16 percent, respectively.
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Author: Sebastian Sinclair