Bitcoin Price Hovers Near $8,000 Ahead of Final CBOE Futures Expiry
Bitcoin’s recovery faced strong resistance on Saturday, as the largest cryptocurrency by market capitalization struggled to overcome the $8,000 price level after multiple attempts. The market is consolidating in the final days of a hotly traded bitcoin futures contract offered by the Chicago Board Options Exchange (CBOE). After June expiry, the Chicago-based exchange will no longer offer crypto-backed derivatives – at least, for now.
After reaching a session high of $8,061, the bitcoin price swung back below the $8,000 level on Saturday. At 9;35 a.m. ET, bitcoin was valued at $7,971 on Bitstamp, having declined 0.4%.
Compared with 24 hours ago, prices were virtually unchanged.
Bitcoin’s daily relative strength index (RSI) has declined sharply over the past week, as the digital currency continued to unwind from extremely overbought levels. Price action remains well supported at the 30-day exponential moving average (EMA). The 30-day EMA has held up to scrutiny since February. A rising accumulation/distribution (A/D) line suggests long positions are still in control.
At current values, bitcoin has a total market capitalization of $141.3 billion. Its share of the overall market has declined to 55.4%, according to CoinMarketCap. This figure was as high as 60.5% last month.
CBOE Bitcoin Futures to Expire Permanently
After being the first U.S. exchange to list a bitcoin futures contract, the Chicago Board Options Exchange is planning to phase out trading of the asset class later this month. The XBT futures contract launched in December 2017 at the height of bitcoin euphoria. The June contract will continue trading until the 19th of this month. No other contracts are planned.
The decision to phase out the asset was announced back in March. At the time, the company said it was re-evaluating its approach to crypto offerings and didn’t rule out another venture in the future.
Bitcoin futures volumes on CBOE and the Chicago Mercantile Exchange (CME) nosedived during last year’s bear market but have picked up considerably in 2019. But CBOE has been unable to keep pace with its Chicago rival, which consistently generates much higher volumes.
Last month, CME’s bitcoin futures contract generated more than $1 billion in daily volume, which was nearly double its average turnover at the time.
CBOE’s exit comes as other major institutions plan to shake-up the cryptocurrency ecosystem with new offerings. Intercontinental Exchange’s Bakkt trading platform is set to launch later this year. Unlike the CBOE and CME markets, Bakkt is offering a physically-settled bitcoin futures contract that will deliver actual BTC into clients’ accounts at expiry.
In terms of fund offerings, Pantera Capital has raised hundreds of millions of dollars from wealthy investors and family offices for a new crpytocurrency fund. Last month, Grayscale Investments released new data showing strong institutional interest in its leading bitcoin trust (GBTC). The GBTC fund now has more than $1.7 billion in assets under management.
Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
Featured image courtesy of Shutterstock. Chart via TradingView.