Open Interest at CME Surges as Institutional Crypto Take-Over Continues Author: Ali Raza Last Updated: 23 October 2020 Bitcoin’s price has been on a stable rise for the past few days. This has contributed a lot to bring the options market for digital assets to record highs. Over the past five days, the price of Bitcoin has risen by 15%, raising the price of the major cryptocurrency above $13,000 for the first time since March last year. Meanwhile, the average open interest (OI) across Bitcoin options has reached $2.5 billion, which is also an all-time high this year. According to data gathered by The Block, the total number of outstanding positions (the aggregate open interest) is valued at $2.48 billion, with crypto exchange Deribit retaining the major share of OI at $1.82 billion. Additionally, CME Group’s Bitcoin option OI has surpassed $337 million, the highest it has recorded. Institutional investors pulling the strings There is no doubt that institutional traders have the lion’s share of trading volumes in the Bitcoin and cryptocurrency market. Crypto assets are even more attractive to these investors when they are taking an upward trend, just as has been seen in the past couple of days. Based on recent data gathered by Skew analytics, Open Interest in the Chicago Mercantile Exchange (CME), one of the world’s largest exchanges, has continued to rise. It has taken the second spot, overtaking that of retail exchange Binance in the process. The upward activity was highlighted by veteran Bitcoin trader Nick Cole, likening it to an “institutional takeover.” However, the development surprised very few market observers, knowing that open interest usually correlates with the price of Bitcoin. That means as Bitcoin rises, it’s going to engineer the upwards movement of open interest as well. Institutional take-over of crypto going as planned. “Remember when it was crypto vs institutions. Those sure were the days,’ Nick said in a Twitter post. CME exchange surpasses Binance to take the second spot In the past, exchanges like BitMEX topped the derivatives. However, that has changed after the legal battle against its executives led to the exodus of investors from the exchange. CME has grown steadily to take up the second spot only behind OKEx. CME has almost $800,000 aggregated OI across major exchanges, which OKEx is nearly $1 billion. Analytics provider Skew revealed that while aggregated OI in major exchanges has reached $5 billion, representing a monthly high, Bakkt still has one of the lowest OI with only $15 million. However, when it comes to 24-hour futures volume, Binance still tops the market with $4.75 billion. Coming second and third are Huobi, with $3.5 billion, and OKEx, with $2.9 billion At press time, Bitcoin was still the dominant crypto asset in terms of market momentum, with total capitalization reaching $300 billion. This represents a more than 110% increase since the beginning of the year.