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Institutional Interest Surges as CME Bitcoin Futures Open Interest Hits Record High
Open interest (OI) on Bitcoin futures traded on the Chicago Mercantile Exchange (CME) hit a new all-time high of over $12.26 billion as of Oct. 18, marking a 36% increase over the past two weeks. This figure surpasses the previous high set in April, reflecting heightened institutional activity in the Bitcoin market. The surge in futures trading suggests that institutional players are anticipating increased volatility or price gains in Bitcoin. CME’s record-breaking OI highlights growing institutional adoption, as professional investors favor its regulatory clarity and structured market.
Avalanche Foundation launches Visa crypto spending card
The Avalanche Foundation has launched the Avalanche Card, a Visa cryptocurrency card allowing users to spend various digital assets, including Circle's USD Coin (USDC), Wrapped AVAX (WAVAX), and BENQI Liquid Staked AVAX (sAVAX). Linked to a self-custody wallet, the card supports both physical and virtual formats and can be used wherever Visa is accepted. Offered by Rain Liquidity, the card initially targets users in Latin America and the Caribbean, excluding certain regions. Unlike traditional credit cards, the Avalanche Card does not report activity to credit bureaus.
Transak reveals data breach impacting nearly 100,000 users, with Stormous ransomware group taking responsibility
Transak, a Miami-based fiat-to-crypto payment gateway, disclosed a data breach impacting 1.14% of its users, or around 92,554 individuals. The breach resulted from a phishing attack that compromised an employee's credentials, granting access to a third-party KYC vendor's system. Sensitive personal data was exposed, but no financial details or assets were compromised. The Stormous ransomware gang claimed responsibility, alleging they stole 300GB of data, including IDs and financial documents. Transak is working with law enforcement and regulators to address the breach and notify affected users.
Trading Desk Insights
Over the weekend, Bitcoin briefly surged towards the $70,000 mark but couldn't hold its ground, retracting to $66,500. This pullback triggered around $200 million in liquidations in the futures market, underscoring the heightened leverage that had been building up—a development we flagged yesterday. Given the recent uptick in leverage, which typically foreshadows volatility, we're eyeing a potential dip towards $63,000 as an optimal entry point for traders.
On another front, Bianco Research highlights a correlation between the rise in the 10-year yield and the improving odds of Donald Trump clinching an election victory. Trump's commitment to imposing tariffs could exacerbate domestic inflation, complicating the Fed's ability to slash rates. This scenario is nudging U.S. Treasury yields higher, which in turn diminishes the attractiveness of more volatile assets.
In the realm of crypto ETFs, Bitcoin ETFs continue to draw significant capital, with inflows totaling $294.3 million, predominantly spearheaded by Blackrock's robust inflows of $329 million. Conversely, Ethereum ETFs have experienced outflows of $20.8 million, applying downward pressure on the broader market.
Turning to the equities market, stock futures dipped on Tuesday, setting the stage for another downtrend on Wall Street. This potential consecutive loss for the S&P 500 would mark its first since early September. The recent spike in interest rates has cast a shadow over the otherwise solid earnings season. With the 10-year Treasury yield breaching 4.20%, market sentiment is tilting towards skepticism regarding the Fed's future rate cuts. Minneapolis Fed President Neel Kashkari's remarks on Monday suggest a more cautious approach by the central bank moving forward.
Crypto Charts
Disclaimer
This research is for informational use only. This is not investment advice. Other than disclosures relating to Secure Digital Markets this research is based on current public information that we consider reliable, but we do not represent it is accurate or complete, and it should not be relied on as such. The information, opinions, estimates, and forecasts contained herein are as of the date hereof and are subject to change without prior notification. We seek to update our research as appropriate.
Any forecasts contained herein are for illustrative purposes only and are not to be relied upon as advice or interpreted as a recommendation. The price of crypto assets may rise or fall because of changes in the broad market or changes in a company's financial condition, sometimes rapidly or unpredictably. Past performance is not a guide to future performance, future returns are not guaranteed, and a loss of original capital may occur. Fluctuations in exchange rates could have adverse effects on the value or price of, or income derived from, certain investments. We and our affiliates, officers, directors, and employees, excluding equity and credit analysts, will from time to time have long or short positions in, act as principal in, and buy or sell, the securities or derivatives, if any, referred to in this research.
The information on which the analysis is based has been obtained from sources believed to be reliable such as, for example, the company’s financial statements filed with a regulator, company website, company white paper, pitchbook and any other sources. While Secure Digital Markets has obtained data, statistics, and information from sources it believes to be reliable, it does not perform an audit or seek independent verification of any of the data, statistics, and information it receives.
Unless otherwise provided in a separate agreement, Secure Digital Markets does not represent that the report contents meet all of the presentation and/or disclosure standards applicable in the jurisdiction the recipient is located. Secure Digital Markets and their officers, directors and employees shall not be responsible or liable for any trading decisions, damages or other losses resulting from, or related to, the information, data, analyses, or opinions within the report.
Crypto and/or digital currencies involve substantial risk, are speculative in nature and may not perform as expected. Many digital currency platforms are not subject to regulatory supervision, unlike regulated exchanges. Some platforms may commingle customer assets in shared accounts and provide inadequate custody, which may affect whether or how investors can withdraw their currency and/or subject them to money laundering. Digital currencies may be vulnerable to hacks and cyber fraud as well as significant volatility and price swings.
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