According to data from Skew Analytics, open positions in Bitcoin futures have reached their highest ever worth $ 10 billion. This means a $ 10 billion position was taken on the future price of Bitcoin. Coinciding with the record, Bitcoin price surpassed $ 30,000 yesterday, reaching an all-time high of $ 34,608.

 

What are Bitcoin futures?

Futures contracts are a type of Bitcoin derivative that involves traders agreeing to buy some Bitcoin in the future at a pre-agreed price.

This means that if Bitcoin rises until the contract expires, the person purchasing the contract will make a profit as they can sell their BTC on the open market. Of course, if the price of Bitcoins falls, then that trader will have lost money.

 

What does an open position mean?

Open positions refer to the numbers of these Bitcoin futures that have yet to be resolved. Some contracts expire after a certain period of time (a day, a month, a quarter, a year, etc.), which is why the open position for futures contracts dropped from $ 9.4 billion on December 31 to $ 8 billion on January 1. partially explains.

Other futures contracts are permanent contracts, which means traders can withdraw whenever they want. And futures contracts are different from options contracts that require traders to buy Bitcoin at maturity, but do not offer this right.

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However, the futures volume picked up again on January 2. There could be two reasons for this. The first is that futures traders whose contracts have just expired see the rising price of Bitcoin and choose to reinvest. Second, a lot of new traders witnessed the price of Bitcoin exceeding $ 30,000 yesterday and wanted to take action.

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