About Bitcoin Futures
With the advancement of technology comes the rise of digital currencies, leading to the rise in the Bitcoin era. As the pioneer of cryptocurrencies, Bitcoin's ascent to prominence is a testament to its potential to reshape the way we engage with traditional financial systems.
With Bitcoin BTC actively traded, exchanges also sought opportunities to launch Bitcoin Futures, providing traders with trading opportunities.
In this article, we delve into the 5 Important Things You Need to Know Before Trading CME Bitcoin Futures.
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What are Bitcoin Futures & How Does Bitcoin Futures Work?
Bitcoin futures are financial contracts that allow traders to speculate on the future price of Bitcoin without having to own the cryptocurrency itself. These contracts are standardized and traded on various exchanges, with each contract representing a specified amount of Bitcoin.
Bitcoin futures offer traders the opportunity to profit from both rising and falling Bitcoin prices, and they are often used for hedging against price fluctuations or for gaining exposure to Bitcoin's price movements without holding the actual asset.
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Types of Bitcoin Futures under the Chicago Mercantile Exchange (CME)
The CME Group offers 2 types of Bitcoin futures under the CME products, which Traders can trade through Orient Futures Singapore – CME Bitcoin Futures and Micro Bitcoin Futures.
Micro Bitcoin futures offer an efficient and cost-effective method to adjust your exposure to Bitcoin, with each contract representing 1/10th the size of a single Bitcoin. These contracts allow traders, regardless of their capital, to effectively manage their exposure to Bitcoin price fluctuations while benefiting from the features of standard Bitcoin futures (BTC).
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Bitcoin CME Futures Contract Specifications
CME Bitcoin Contract Specifications
The CME Chicago Bitcoin Futures Contract has the following specifications:
The Futures Contract has a contract unit of 5 bitcoins, with the following minimum price fluctuation of $5.00 per bitcoin ($25.00)
Monthly contracts listed for 6 consecutive months, quarterly contracts (Mar, Jun, Sep, Dec) listed for 4 additional quarters and a second Dec contract if only one is listed.
Trading terminates at 4:00 pm London time on the last Friday of the contract month.
CME Trading hours (CME Globex) is as follows:
Sunday - Friday 5pm – 4pm Central Time (CT) with a 60-minute break each day beginning at 4pm.
CME Globex Bitcoin Futures symbol: BTC
Click here to find out about the CME Micro Bitcoin Futures Contract Specifications.
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Price Gap and Cross-Arbitrage Trading
A unique phenomenon that occurs in futures trading is the utilization of the 'price gap.' It refers to a situation in financial markets where there is a significant difference between the closing price on one trading day and the opening price on the following trading day, creating a visible gap on the price chart.
The Bitcoin CME Gap is specific to the Bitcoin futures market and does not apply to the spot market where actual Bitcoins are bought and sold.
Another trading strategy that has gained considerable acclaim is Arbitrage Trading. This strategy capitalizes on price differences of an asset across various markets to generate profits.
This approach can be applied to various commodities futures, including Refined Copper arbitrage trading and Rubber Cross-arbitrage trading. It can also be applied to Crypto Cross-Arbitrage Trading, particularly for Bitcoin Futures.
In addition to CME, other exchanges also offer Bitcoin ETF Futures. The Asia Pacific Exchange provides Bitcoin Perpetual Futures, while ICE Futures Singapore (ICE SG) offers BAKKT Bitcoin (USD) Cash Settled Monthly Futures.
Click here for the Guide for QFI Cross Arbitrage.
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Bitcoin News and Bitcoin Price Today
According to CNBC, Bitcoin's trading volume recently hit its lowest point in nearly five years, leaving investors awaiting catalysts to re-enter the market.
On August 12, it had dipped to 112,317 BTC, marking its lowest level since November 10, 2018. This represents a decline of about 94% from the peak trading volume of 3.5 million BTC in March. As of August 26, Bitcoin's trading volume on all exchanges was recorded at 129,307 BTC.
Click here for the today’s bitcoin price live from Binance.
Start Trading With Orient Futures Singapore
Being an Overseas Intermediary of Shanghai International Energy Exchange (INE), Dalian Commodity Exchange (DCE), and Zhengzhou Commodity Exchange (ZCE), when foreign clients participate in internationalised futures contracts in these Chinese markets with us, they have direct access to trading, clearing, and settlement. Our parent company, Shanghai Orient Futures, is the largest broker in terms of aggregated volume across the five regulated exchanges in China.
Orient Futures Singapore also currently holds memberships at the Singapore Exchange (SGX), Asia Pacific Exchange (APEX), and ICE Futures Singapore (ICE SG). Starting August 2023, corporate clients can also gain access to the B3 Exchange through us.
We provide bespoke services to our professional clients, tailored to their corporate and individual needs. Our team will be there for you 24 hours on trading days to provide a one-stop portal for all your trades, with simple processes and an intuitive user interface that has low or near-to-zero latency.
