- The exchange is set to increase the monthly limit for Bitcoin contracts.
- The market has stabilized and become less speculative.
The Chicago Mercantile Exchange (CME Group) will increase the monthly limit on Bitcoin Futures open positions to 10,000 BTC or 2000 contracts.
"Increased spot-month position limits in CME Bitcoin futures will be available Sept 30, pending reg review. Limits will increase to 2K contracts, equal to 10K bitcoin, to provide customers,”CME wrote on Twitter.
The change will take place on September 30 subject to CFTC approval.
Currently, open positions are limited by 1,000 contracts or 5,000 BTC; however, it has never been reached. CME is confident that the growing interest in flexible risk hedging instruments for bitcoin is yet to come.
Limits on open positions are set by the CFTC to prevent market manipulation. If the agency approves the changes, it will recognize that the likelihood of excessive speculation in the bitcoin market has decreased.
In 2019, an average of 7,100 Bitcoin contracts was concluded daily on the CME, and the average daily trading volume was $237 million (as of the end of August). A record number of large open interest holders is 56. According to the press release, the exchange has seen “20 successful, uneventful settlements.”
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