Bitcoin’s Market Cap Hovers Near $71 Billion as BitMEX Launches September Futures Contract

Bitcoin’s market capitalization found support near $71 billion on Sunday, buttressed by an upsurge in trade volumes that were accompanied by the launch of a new BitMEX futures contract. BitMEX. The derivatives platform has been the most popular cryptocurrency exchange since November based on total market share.

BTC/USD Update

The bitcoin price traded tepidly on Sunday, as trade volumes declined sharply from their recent 12-month high. On most major exchanges, bitcoin was trading in the $3,975 range. On Bitfinex, it was offered at $4,078.

Looking at CoinMarketCap’s aggregate data feed, we see an average bitcoin price of $4,034.59, little changed from 24 hours ago. Trade volumes over that period fell to around $8.3 billion from highs of around $11 billion.

Bitcoin’s market capitalization is currently valued just under $71 billion, having gained $2 billion since Friday. Bitcoin’s dominance rate is holding steady at 50.7%. Its share of the overall market has declined steadily in recent weeks as altcoins and tokens continue to form greater price independence.

Bitcoin is still on track to test major hurdles. Read more: Bitcoin Pierces Through Key Psychological Barrier as Bulls Eye December High

The BitMEX Factor

Cryptocurrency trader Luke Martin has drawn attention to the fact that bitcoin’s breakout came almost immediately after a new BitMEX futures contract started trading. The September futures contract, labelled XBTM19, began trading on Friday. Less than a day later, bitcoin was back above $4,000.

This relationship is not unlike the one we saw in December when volatility and volume surged right after June futures began trading.

BitMEX has quickly emerged as one of the world’s biggest markets for bitcoin trades, a trend that seems to have intensified during the depths of the bear market. In the month that followed the bitcoin cash hard fork on November 15, BitMEX regularly saw more than a third of bitcoin’s daily trade volumes. Over that same period, bitcoin’s market cap halved.

On December 18, Hacked observed the following:

BitMEX has been at the center of the bitcoin selling spree of the last six weeks. As bitcoin printed successive lows, volumes on the exchange skyrocketed. At its highest point, BitMEX was processing more than a third of bitcoin’s daily trade volumes on virtual currency exchanges. Clearly traders were shorting BTC.

The online derivatives platform has seen its influence decline over the months after shutting down its U.S. operations due to regulatory scrutiny.

Bitcoin futures contracts and their expiration have a direct influence on volume, volatility and the commodity’s underlying price. This seems to hold true for both CBOE and CME futures contracts, with bitcoin’s price often declining in the lead up to expiry.

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.

Author:
Chief Editor to Hacked.com and Contributor to CCN.com, Sam Bourgi has spent the past nine years focused on economics, markets and cryptocurrencies. His work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Avid crypto watchers and those with a libertarian persuasion can follow him on twitter at @hsbourgi

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