Tim McCourt, managing director and global head of equity products and alternative investments of the CME Group, has said that bitcoin futures are not to be blamed for the price slump in the crypto market this year.
Talking with Phillip Gillespie, CEO of B2C2 Japan, during a panel on crypto derivatives trading at CoinDesk’s Consensus Singapore 2018event, Tim told the audience that he does not think the introduction of bitcoin futures products resulted in the recent market downturn.
“We are just a small part of the market,” he added.
On the contrary, McCourt said bitcoin futures market has been growing, especially with volumes coming from Asia markets, which has been “fascinating.” Explaining that trading activities in the hours before the U.S. market opens have a strong influence on the price of bitcoin futures on CME, he said:
“Out of the 40 percent of bitcoin futures trading on CME that’s outside the U.S., 21 percent are coming from Asia.”
DRW founder Don Wilson, in a fireside chat this morning at Consensus Singapore, also said that bitcoin derivatives trading volume from Asia is approaching that of the U.S., referencing data from both CME and Cboe.
McCourt went on to say that CME rolled out its bitcoin futures products “in response to demand from market participants who want to trade crypto derivatives on a regulated exchange.”
“They want a regulated exchange to provide that vehicle with risk management to increase their comfort level,” he added.
Echoing that, Gillespie said that, with larger exchanges moving into crypto derivatives and spot trading, regulators are also taking the space much more seriously now – a shift that may eventually open the doors to wider institutional adoption of crypto trading.
Talking about recent moves by Japan’s Financial Services Agency to inspect security and anti money-laundering measures at exchanges in the country, Gillespie said B2C2 has not had seen revenue in the past several months.
Still, he believes that, with regulators giving clearer rules on various aspects on cryptocurrency trading, institutional crypto trading is on the way.
CoinDesk reported early this year that the trading volume of bitcoin derivative products in Japan had grown from $2 million in 2014 to a whopping $543 billion in 2017.
“We are starting to see regulators are coming in and institutions will be ready to come back next as regulators are shaping the space into more of a professionalism for sophisticated investors with more strict hiring structure and know-your-customer measures.”
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