As per the latest data from Skew (data analytics firm), the number of open futures contracts or the Open Interest hiked to $13 million which crossed the earlier record of $ 12 million (Feb 3, 2020).
Bakkt's BTC Futures Open Interest reaches a new all-time high. pic.twitter.com/9ve3pdqCtT
Since the last two weeks, Open Interest has shown a dramatic change by rising from $5.5 million to $13 million, i.e. a rise of 13.6 percent. The open positions of Bakkt's bitcoin futures on Chicago based Merchantile Exchange raised from $185 million(two weeks ago) to $249 million (present-day) i.e. 34.5 percent. The uptrend of price accompanied by Open Interest represents the strength to move higher as per the traders of the market.
Open Interest can aid the futures traders to sense about gaining or losing strength in the crypto market. Open Interests coexists with volume and price to affect the market. If all the indicators are trending upwards, then the underlying asset is bullish. The trend can be explained as:
The platform of Bakkt is setting records in the crypto market. Among the high open interests, trading volumes are declining since Dec 18, which was around $44 million or 6601 BTC. Presently, the trading volume is down to $27 million, of which physically settled futures comprises $16 million. Nevertheless, the Bakkt's platform is gaining popularity amongst the institutions due to its regulated nature in the market.
The increasing open interest may reflect the institutional interest in the crypto market and could speed up the evolution of bitcoin as a mature asset class.