The highly-regulated Chicago Mercantile Exchange has overtaken BitMEX as the derivatives exchange with the second largest amount of open interest for Bitcoin futures contracts, data from Skew Analytics shows. This, after US law enforcement pressed charges against BitMEX’s owners for complacency over money-laundering at the beginning of the month.
OKEx is still the leader in terms of open interest—even though its founder was also taken in by police this month and withdrawals stopped.
Bitcoin futures contracts are, essentially, bets on Bitcoin’s future price. If, through some lapse in our judgment, you manage to negotiate a futures contract with Decrypt to buy Bitcoin at $5,000 next month, we would have to give you that Bitcoin for $5,000 upon the expiry of that contract.
Obviously, in this scenario, it would be in our interest for Bitcoin’s price to collapse. You can also trade these Bitcoin futures contracts, which are essentially hot potatoes until they expire.
There is $0.79 billion worth of open interest for Bitcoin futures contracts on CME. That means that there are $0.79 billion worth of Bitcoin futures contracts yet to expire. There’s $0.96 billion worth of open interest on the market leader, OKEx, and $0.61 billion on BitMEX.