Everything you wanted to know about BTC futures but were afraid to ask!

[Dabs]

Futures are derivative financial contracts that obligate the parties to transact an asset at a predetermined future date and price. Here, the buyer must purchase or the seller must sell the underlying asset at the set price, regardless of the current market price at the expiration date.

The whole point of "Futures" is ... well, ... at least one purpose is to hedge. To prevent losses from potentially unfavorable price changes rather than to speculate.

At the very least, the futures market is regulated, some are even insured. (I think all of them are insured to some extend, maybe there's a limit.)

Dealing with actual bitcoins, as in holding the private keys to your wallet, is daunting for a lot of people who don't know or even have a clue how the technology works. For the institutional investors, this is where custodial solutions come in. For the private ones, if they know someone like one of us (assuming you know how to do cold storage and stuff like that.)

[Faxmate]

I don't like futures for Bitcoin or Ethereum. Because they integrate the current economic system with blockchain. More precisely, they transfer the bad aspects of the current economy to the blockchain economy. Bitcoin is limited. So it is valuable.

NOT like any of us can really do anything about the existence or NON-existence of such products.  Right?  Good to be aware of these kinds of products to the extent that they might be used to affect, control or manipulate price... or attempted to be used for such.

Actually there is, we can choose to not participate in the dilution of the asset class.

We can also educate those that ask this same question why these  unsettled "liquidity supplying, volatility squashing" markets should not be supported but rather the asset itself purchased and held.

Every coin being rolled over in house in these clearing houses is one less actually being bought on chain and that is a direct dilution of the cap.

Think of if no-one had herded to Walmart as was forewarned by so many of us..

If you want institutional money, if you want big traders money for Bitcoin you can't avoid derivatives...
Moreover futures can be very useful for all the miners, they are able to sell at fixed prices several weeks or months before getting their bitcoins.
And don't forget that most of futures exchanges only accept bitcoins. So you need to buy "real" bitcoins before trading on them.

Miners and traders are now day very happy with their bitcoin because day by day bitcoin is increasing the value and it's being good for trading after holding of specific time periods. Trading right now is not good as the market is under recovery but I think with little patience I will be able to get my target profit just need to be patient.

[JayJuanGee]

I don't like futures for Bitcoin or Ethereum. Because they integrate the current economic system with blockchain. More precisely, they transfer the bad aspects of the current economy to the blockchain economy. Bitcoin is limited. So it is valuable.

NOT like any of us can really do anything about the existence or NON-existence of such products.  Right?  Good to be aware of these kinds of products to the extent that they might be used to affect, control or manipulate price... or attempted to be used for such.

Actually there is, we can choose to not participate in the dilution of the asset class.

We can also educate those that ask this same question why these  unsettled "liquidity supplying, volatility squashing" markets should not be supported but rather the asset itself purchased and held.

Every coin being rolled over in house in these clearing houses is one less actually being bought on chain and that is a direct dilution of the cap.

Think of if no-one had herded to Walmart as was forewarned by so many of us..

If you want institutional money, if you want big traders money for Bitcoin you can't avoid derivatives...
Moreover futures can be very useful for all the miners, they are able to sell at fixed prices several weeks or months before getting their bitcoins.
And don't forget that most of futures exchanges only accept bitcoins. So you need to buy "real" bitcoins before trading on them.

Miners and traders are now day very happy with their bitcoin because day by day bitcoin is increasing the value and it's being good for trading after holding of specific time periods. Trading right now is not good as the market is under recovery but I think with little patience I will be able to get my target profit just need to be patient.

What does that mean?  Yeah of course, btc prices go up and they go down, and if they go up too quickly, then there is likely to be a decent sized correction, but how the fuck does anyone know how far to take profits.  Yeah, you can play a bit here or there to hedge, but you, Faxmate, seem to be suggesting that you are planning on making some BIG play in the near future to either sell a large portion of your BTC or to short... and seems very risky to me, unless you are just playing with a small amount of your stash.

I will personally concede that I feel a decent level of froth in the whole damned space, and it really does not have to do with futures, as far as I can tell, but of course, futures players remain one of the factors that must be considered.  My worry remains the ongoing pumpening of some of the obvious crap such as the various alt coins.  So yeah, even though the vast majority of them are merely riding off of the coat tails of bitcoin, they just seem to be too eager to pump in ways that just signal (at least from my perspective) needs for correction.  I am not as worried about bitcoin's ability to sustain a decent pump, even beyond the $13,880 top from June 27, 2019... So yeah, there seems to be kind of a need to monitor some of the phony baloney that is taking place on the sidelines, too.. and some of the financial instruments seem to be eying ways to add some of those frothy coins into their options whether referring to their price or sometimes using some phony coin like ethereum as collateral... which seems dangerous as fuck, given their all over the place code base.. and even uncertainties in terms of transitioning its code base... People who play with futures, must be attempting to account for dynamics in the whole space, even if their instruments are utilizing bitcoins more and using bitcoin prices as referents.

[doomloop]

Futures are derivative financial contracts that obligate the parties to transact an asset at a predetermined future date and price. Here, the buyer must purchase or the seller must sell the underlying asset at the set price, regardless of the current market price at the expiration date.

The whole point of "Futures" is ... well, ... at least one purpose is to hedge. To prevent losses from potentially unfavorable price changes rather than to speculate.

At the very least, the futures market is regulated, some are even insured. (I think all of them are insured to some extend, maybe there's a limit.)

Dealing with actual bitcoins, as in holding the private keys to your wallet, is daunting for a lot of people who don't know or even have a clue how the technology works. For the institutional investors, this is where custodial solutions come in. For the private ones, if they know someone like one of us (assuming you know how to do cold storage and stuff like that.)

So it is better for everyone to first get the knowledge about the wallet, how to use it, how to ensure the security it offers and what are the backups for you before saving your coins. After getting this all information go for the hard wallet if you fear a lot of risks and can have better form of security. This will make you more confident and relax before saving your huge amounts.

[Hueristic]

If you want institutional money, if you want big traders money for Bitcoin you can't avoid derivatives...
Moreover futures can be very useful for all the miners, they are able to sell at fixed prices several weeks or months before getting their bitcoins.
And don't forget that most of futures exchanges only accept bitcoins. So you need to buy "real" bitcoins before trading on them.

Why the fuck do you want them involved at all?

This is a revolution of the people, WE don't need nor want them.

Figures don't lie but liars figure. <<<--- that describes the entire institutional banking system and we should not want them involved on the NEW economy.


We were doing just fine until they started their futures market and skimmed the cap and got their greedy little hands in our pie.

[fillippone]

If you want institutional money, if you want big traders money for Bitcoin you can't avoid derivatives...
Moreover futures can be very useful for all the miners, they are able to sell at fixed prices several weeks or months before getting their bitcoins.
And don't forget that most of futures exchanges only accept bitcoins. So you need to buy "real" bitcoins before trading on them.

Why the fuck do you want them involved at all?

This is a revolution of the people, WE don't need nor want them.

Figures don't lie but liars figure. <<<--- that describes the entire institutional banking system and we should not want them involved on the NEW economy.


We were doing just fine until they started their futures market and skimmed the cap and got their greedy little hands in our pie.

It’s not bitcoin needs Wall Street. It's Wall Street that needs bitcoin.

[JayJuanGee]

If you want institutional money, if you want big traders money for Bitcoin you can't avoid derivatives...
Moreover futures can be very useful for all the miners, they are able to sell at fixed prices several weeks or months before getting their bitcoins.
And don't forget that most of futures exchanges only accept bitcoins. So you need to buy "real" bitcoins before trading on them.

Why the fuck do you want them involved at all?

This is a revolution of the people, WE don't need nor want them.

Figures don't lie but liars figure. <<<--- that describes the entire institutional banking system and we should not want them involved on the NEW economy.


We were doing just fine until they started their futures market and skimmed the cap and got their greedy little hands in our pie.

You cannot really wish institutional investors away, even if you have preferences for them NOT to be here or not to attempt to manipulate the fuck out of the space.  There are also some people who will not invest into anything except through institutional investors and there are also institutional investors that do not take individuals for clients, unless they have like at least a $million to invest.. Love or hate them, they are increasingly coming to the space, and I look forward to some of them getting reckt, even though in the end, they are likely already going to be able to figure out various ways to hedge in order NOT to get REKT, even if they do not really understand their investment asset (referring to BTC).

[jostorres]

I guess "you" can decide not to take part on it but as long as there is a demand for it they will continue to exist. You can't just create some sort of strike of bitmex or whatever and suddenly try to get people to stop as well, if people are using it they will continue to use it.

All you can do is to hope people will find this as a hype and slowly start to use it less and less eventually leading to the demise of futures but looks like that is not going to happen anytime soon. I agree that futures are the bad part of current financial system and should have never been part of bitcoin itself but at the same time I have nothing I can do about it neither. Hopefully, overtime we will find a way to over-volume these futures and make them not so important in the current system.

[atjiat]

Very often, cryptocurrency users complain about Bitcoin futures, because, in their opinion, before the expiration of fixed-term contracts, the price of Bitcoin reacts to these circumstances and is actively declining.  I couldn’t find a balanced answer anywhere on this question, although it seems to me that trading in Bitcoin futures is much less than the volume of trading in the cryptocurrency market and therefore can not fully influence bitcoin pricing.

[Baoo]

Thanks for this information OP, I  already gave you a merit, you certainly deserve it,  Bitcoin's community should read all of this thread especially the newbies or the beginners, it is really helpful to be honest. Hopefully Bitcoin will have a brilliant future.
Plus,  if you have a lack of knowledge in any domain then you will probably gain nothing, in my opinion, knowledge is the key of successful. Unfortunately, most of users think that Bitcoin's field or crypto is complicated and hard to learn, they always want earn money in an easy way without even a  hardwork, and that cannot happen for sure.

[Hueristic]

If you want institutional money, if you want big traders money for Bitcoin you can't avoid derivatives...
Moreover futures can be very useful for all the miners, they are able to sell at fixed prices several weeks or months before getting their bitcoins.
And don't forget that most of futures exchanges only accept bitcoins. So you need to buy "real" bitcoins before trading on them.

Why the fuck do you want them involved at all?

This is a revolution of the people, WE don't need nor want them.

Figures don't lie but liars figure. <<<--- that describes the entire institutional banking system and we should not want them involved on the NEW economy.


We were doing just fine until they started their futures market and skimmed the cap and got their greedy little hands in our pie.

You cannot really wish institutional investors away, even if you have preferences for them NOT to be here or not to attempt to manipulate the fuck out of the space.  There are also some people who will not invest into anything except through institutional investors and there are also institutional investors that do not take individuals for clients, unless they have like at least a $million to invest.. Love or hate them, they are increasingly coming to the space, and I look forward to some of them getting reckt, even though in the end, they are likely already going to be able to figure out various ways to hedge in order NOT to get REKT, even if they do not really understand their investment asset (referring to BTC).

You are correct, I cannot wish them away, all I can do is point out why We should not be helping them in any way shape or form and that includes accepting them as inevitable.

When it all boils down they have unlimited funds that are provided by the Fed and obfuscated into the system, the more tools they have to obfuscate those infused funds that dilute the underlying assets value (purchasing power) the easier it is for them to control and hide the process. Therefor by shining a light on their practices and not participating in their schemes is a tertiary act against their actions.

[fillippone]

This morning I saw  tweet by PlanB

#bitcoin BTC halving still a non-event on futures markets

https://twitter.com/100trillionUSD/status/1225189897117618182?s=20

Well we saw in the OP how the future curve is shaped.
It has to do with carrying your position untily maturity.
There is no reason why future curve should bend upward after halving, as the spot price is the current best predictor (net of cost of carry) of future prices: if we are sure that the price will move at 100K right after the halving, there is no reason not to buy now.
So the spot price is alwys the best forecast of forward price.

[fillippone]

Nice Article today about the importance of Open Interest (despite the slightly click-baitish title):

This Bitcoin Metric Is Over 100% Higher in 2 Months, and It’s Critical for Bulls

They reported that as of February 13th, the aggregated amount of open interest on Bitcoin futures contracts surpassed $5 billion, with traders on BitMEX, OKEx, Bakkt, CME, and other key platforms throwing billions of dollars at the asset.

This is far above the approximately $4 billion in open interest seen in January of the $2.5 billion in December.

This is especially true when relating to BAKKT open interest, that is, contrary to other exchanges' one, directly converted into physical bitcoin.

[fillippone]

This post is eligible for my project:

Help me translate my best posts in your Local Board

I am a strong believer in the utility of local boards.
I am lucky enough to be able to express myself in at least a couple of languages, but I know this is not the case for everyone.
A lot of users post only in the local boards because of a variety of reasons  either language or cultural barriers, lack of interest or whatever other reason.
I personally know a lot of very good users (from the italian sections mainly, for obvious reason) who doesn't post in the international sections.

I think all those users they are missing a lot of good contents posted on the international (english) section or on other boards.

If you think you can help here, just visit the thread!

Russian Translation by FontSeli: Bce, чтo вы xoтeли бы знaть o фьючepcax нa BTC

[fillippone]

A few updates on the thread:

• Corrected a few minor typos
• Few minor edits
• Modified a factual error on Market Efficiency Hypothesis. Efficiency is "semi-strong" rather than "weak".

[Hueristic]

If you want institutional money, if you want big traders money for Bitcoin you can't avoid derivatives...
Moreover futures can be very useful for all the miners, they are able to sell at fixed prices several weeks or months before getting their bitcoins.
And don't forget that most of futures exchanges only accept bitcoins. So you need to buy "real" bitcoins before trading on them.

Why the fuck do you want them involved at all?

This is a revolution of the people, WE don't need nor want them.

Figures don't lie but liars figure. <<<--- that describes the entire institutional banking system and we should not want them involved on the NEW economy.


We were doing just fine until they started their futures market and skimmed the cap and got their greedy little hands in our pie.

You cannot really wish institutional investors away, even if you have preferences for them NOT to be here or not to attempt to manipulate the fuck out of the space.  There are also some people who will not invest into anything except through institutional investors and there are also institutional investors that do not take individuals for clients, unless they have like at least a $million to invest.. Love or hate them, they are increasingly coming to the space, and I look forward to some of them getting reckt, even though in the end, they are likely already going to be able to figure out various ways to hedge in order NOT to get REKT, even if they do not really understand their investment asset (referring to BTC).

You are correct, I cannot wish them away, all I can do is point out why We should not be helping them in any way shape or form and that includes accepting them as inevitable.

When it all boils down they have unlimited funds that are provided by the Fed and obfuscated into the system, the more tools they have to obfuscate those infused funds that dilute the underlying assets value (purchasing power) the easier it is for them to control and hide the process. Therefor by shining a light on their practices and not participating in their schemes is a tertiary act against their actions.

Unfortunately this continues to age well.

[Biodom]

The famed Medallion fund of Renaissance technologies hedge fund is poised to enter trading in bitcoin futures.
Not sure if it is bullish or bearish.
https://www.ft.com/content/6ea8207b-b41a-43df-9737-ae481814a8d4

[fillippone]

The famed Medallion fund of Renaissance technologies hedge fund is poised to enter trading in bitcoin futures.
Not sure if it is bullish or bearish.
https://www.ft.com/content/6ea8207b-b41a-43df-9737-ae481814a8d4

Damn Paywall!

[Last of the V8s]

The famed Medallion fund of Renaissance technologies hedge fund is poised to enter trading in bitcoin futures.
Not sure if it is bullish or bearish.
https://www.ft.com/content/6ea8207b-b41a-43df-9737-ae481814a8d4

Damn Paywall!

https://archive.is/EIAfy
always search on archive.is
with the ft and many others, you can archive it yourself if no one else has

[kaicrypzen]

On the CME we get both informations:



On the 25th of September 5,824 contracts were traded on the September expiry, there are a total of 1171 contracts open, 171 less than yesterday close (actually OI are not updated on real times, so both those figures relate to one day before, but you get the concept).

Can anyone please explain how we get these figures

there are a total of 1171 contracts open, 171 less than yesterday close

from the displayed data?

Thank you