Bitcoin and Ether Futures Surge in Q2 Driven by Institutional Demand

The interest in Bitcoin and Ether futures among institutional investors increased in the second quarter as investors seek out products that enable them to mitigate risks and the impact of high market volatility.

According to a report from the Chicago Mercantile Exchange (CME) shared with Coindesk, the number of institutional investors holding at least 25 Bitcoin futures contracts was 107 on average during the second quarter, while those holding Ether futures were 62.

Additionally, more institutional investors opted for CME’s regulated and cash-settled futures during the quarter as a way of investing in Bitcoin and Ether without having to own the crypto assets. On top of that, an increase in demand for hedging tools boosted the trading volumes and the open interest in BTC and Ether.

Bitcoin and Ether Prices

The increase in funds channeled by institutional investors into Bitcoin and Ether futures was boosted by the rise in price of the top cryptocurrencies, the CME said. The price of Bitcoin increased 84% in the first half of the year and upped 7% in the three months that ended in June.

Open interest in standard Bitcoin futures contracts, which refers to the number of active contracts at a given time, increased 15% year-over-year to an average of 14,800 contracts in H1. Besides that, the open interest in Bitcoin options was 9,400 contracts on average during the period, representing an increase of 175% year-over-year.

Spot Bitcoin ETFs

The growing interest among institutions in Bitcoin futures is reportedly attributed to the recent wave of applications for spot Bitcoin ETFs by several asset managers in the US. Finance Magnates reported about a week ago that Bitcoin exchange-traded products (ETPs) had reached a record high.

The ETPs increased 25,202 Bitcoins (equivalent to USD $757 million) to 196,824 Bitcoins during the four-week period ending July 16. The figures represented the second-highest monthly investments in ETPs since the first Bitcoin-based futures contract was launched in 2021.

The top asset management company globally, BlackRock, submitted an application to list the first US spot Bitcoin ETF in June. Similarly, the exchange operator Cboe filed applications for the spot Bitcoin ETFs on behalf of Fidelity, WisdomTree, VanEck, and Invesco.