Thursday 17 December 2020 10:19 am

Breaking the barrier

By: Crypto AM Daily in association with BEQUANT

Monkey of the back

Bitcoin finally pierced its way through the key $20,000 level and more important for the longevity of the uptrend, the break did not result in an aggressive trigger of stops. Instead, the break was well managed and steady. The subsequent price action was equally steady, even if somewhat one directional and by early Thursday morning, Bitcoin was trading just shy of $23,000 level.

As expected, the open interest (OI) surged to a new record high and the uptick in the OI was particularly evident on the CME, which surged almost 25%.

In the Markets

Success of the ecosystem

At the same time, Ethereum’s OI also printed a new record high, not least aided by the reports that the CME will launch Ethereum futures. Each contract will have 50 units of ether and the new contracts will use the CME CF ether-dollar reference rate from CF Benchmarks, the FCA-approved crypto indices provider.

The institutional crowd is already here and key factors to its sustained growth will be further evolution and development of market infrastructure, including the prime brokerage offering, sophisticated custodian solutions and further growth of the lending (repo) market.

The growth of ETPs and other fund structures is also crucial and this is where signs of overheating will be first noticeable, should unwinds of recent inflows begin to materialise.

Crypto AM: Longer Reads

Crypto AM: In conversation with James Bowater