It is as usual for the CME Group's bitcoin futures market, despite a cut in Cboe Global Markets, with competing derivative exchanges.
Contacting CoinDesk Friday, a CME spokesman said the exchange did not "have any changes to announce our bitcoin futures contract" and refused to comment on the CBOE refund.
The confirmation is remarkable in light of the news Thursday that the CBOE will not add a bitcoin futures contract for trading in March.
This means that after the previous traded futures expire in June, this market will initially stop at the Cboe Futures Exchange (CFE), at least until new futures are listed.
"CFE is considering its approach to how it intends to continue offering digital asset derivatives for trading. While considering its next steps, CFE currently does not intend to list additional XBT trading futures," the company said. its notice to investors.
A spokesman for CBOE refused to comment on Thursday's product update.
The difference in outcomes is not so surprising since CME's volumes have been about more than double-occupancy.
As of March 1
Product Market Form
Market participants offered several explanations for CME's excess of CBOE in bitcoin futures.
One reason may be the difference in how the two exchanges approached the product and marketed it, Lanre Sarumi, CEO of a Crypto Activity Derivative Trading Level, CoinDesk said.
First and foremost, CME made its product available to a larger group of traders right from the start, Sarumi explains, saying:
"Linking to both CME and CBOe is expensive. If you are already trading other products on a switch, Then there is no new price, if not, you have to pay for connection, software license, market data, cross-connections etc. – all just to trade a new product? "
CBOE adds bitcoin futures to the CBOE Futures Exchange (CFE), Sarumi continues, where people mostly deal with CBOe Volatility Index (VX) Futures: "If you are not trading VX, you will pay hundreds of dollars extra per account just to dabble in bitcoin?"
CME group, on the other hand, put bitcoin in the stock group of the CME exchange, which offers many products and asset classes that enjoy large daily volumes, Sarumi said. So many traders who already traded with different assets on CME had no further steps to get into bitcoin.
Other Intangible Assets
In addition, CME invested more efforts to promote its futures than CBOs, Sarumi believes. "CBOe was more like" building it and they will come. ""
The price distortion method could also contribute to CME's advantage: while CBOE relies on an auction on the Gemini Stock Exchange, CME settles for a total price on multiple spot markets
John Todaro, Research Director at TradeBlock, says that CME's strategy could had more success due to greater flexibility.
"CME had bigger positions so single accounts could hold a larger number of contracts," he told CoinDesk. "Over time, CME has gained larger market share. CBOE claimed contract limits to remain competitive late in the summer of 2018, but CME traded at significantly higher volumes."
Marc Hochstein contributed reporting.
] Picture of CME director of equity products Tim McCourt via CoinDesk archives