Within three hours after its listing of bitcoin futures, the website and online trading platform of the Chicago Board Options Exchange (CBOE) were inaccessible, due to an unexpected spike in demand and volume.
According to Yuji Nakamura, a Tokyo-based technology journalist, CBOE bitcoin futures processed $401,600 worth of trades within the first 20 minutes.
Upon its debut earlier this year, the US Commodities and Futures Trading Commission (CFTC)-approved bitcoin derivatives, futures, and options exchange LedgerX announced that it had settled $1 million throughout its opening week, a period in which the exchange planned to clear minimum volumes to test the system.
A similar situation had occurred with CBOE during the first few hours since its listing of bitcoin futures. A sudden spike in volume and demand from institutional investors and retail traders in the traditional finance industry led the CBOE trading platform to become inaccessible for a brief period.
Over the next few weeks, institutional investors and investment firms with hundreds of billions of dollars in capital are expected to invest in the bitcoin market. Given that large-scale hedge funds are restricted to invest a minimum value of a few hundred million dollars, it is likely that in the short-term, billions of dollars will be invested in bitcoin.
Throughout the past month, several analysts expressed their concerns over the possibility of shorting bitcoin at a larger scale through bitcoin futures and CBOE’s futures exchange. Some analysts claim that excessive shorting of bitcoin could lead the price of the cryptocurrency to plunge.
However, as Zerohedge reported on December 11, investors have been paying premiums to invest in bitcoin.
Currently, the price of bitcoin futures is up by over 20 percent since open. XBT/F8, the main bitcoin futures contract listed on the CBOE’s trading platform, is being traded at over $18,210, with a premium of $1,960.
Finance February 12, 2021