Bitcoin Futures contracts in Q3 2020 do not have the same level of bullish activity that proliferated Q2

By Selena On Jun 27, 2020

According to the latest report from Arcane Research, when Bitcoin prices have dropped over the past few weeks, Futures prices falling down to spot levels, well before the expiry. More info, on June 26, Bitcoin Futures contracts quarterly reached its expiry after Bitcoin Futures’ Open Interest touched a 3-month high of $ 98 million on Deribit.

Source: Arcane Research

Will Bitcoin Futures contracts create a similar level of activity in the third quarter of 2020?

According to the chart above, the premium rates for Bitcoin Futures Contracts are as low as 0.13% for CME Futures, while other retail platforms are accumulating a premium of 0.10% on the chart.

The report stated:

“CME traders are still buying futures at a higher price than retail-focused platforms for next quarterly contracts.”

The second quarter of 2020 for Bitcoin is significant. Bitcoin has been falling since the end of Q1, and to survive the economic weaknesses witnessed in March and April, it is necessary to benefit Bitcoin. Bitcoin soared with a persuasion for most of April and May. However, the momentum soon slowed down towards the 3rd week of May, and as per the monthly returns at the time of writing, June may be looking at negative Bitcoin ROIs.

The upward momentum that witnessed the revival early in the second quarter was transferred to the Future market until the end of the term. Still, a similar level of activity may not take place in the third quarter of 2020 for Bitcoin and its Futures contracts.

Source: Kraken Volatility Report

According to a report from Kraken, historically, July and August are often negative on the monthly profit of BTC / USD. With the level of volatility decreasing over the past few weeks, BTC futures contracts in the third quarter of 2020 may not have the same level of growth activity in the second quarter of this year.

At the moment, the momentum seems to have exhausted, with Bitcoin entering a protracted correction phase. Therefore, high premiums paid by CME traders for the third quarter of 2020 BTC futures expiring in September may decline at a faster rate than expected.

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