CME’s Bitcoin options open interest has reached an all-time high.

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Reuters reported on the 2nd (local time) that open interest in options on the Chicago Mercantile Exchange (CME) reached an all-time high. The Block’s data dashboard. Over the past 24 hours, open options interest on the CME Bitcoin futures contract has reached nearly $2 billion.

The same result was observed with Velo Data, which showed options open interest on CME Bitcoin futures reaching a peak of $2.1 billion.

An increase in open interest indicates a very liquid market with many participants. Open interest refers to the total number of outstanding option contracts that have not been exercised. Increasing open interest means increased sophisticated trader activity as new contracts are created and added to existing contracts.

According to data from Coinglass, options open interest at expiration dates in late December is more heavily weighted toward calls than puts, with 65% being calls and 35% being puts. When call volume exceeds put volume, it is interpreted as a bullish indicator.

Open interest in Bitcoin options on CME has reached multi-year highs.

Bitcoin futures traders betting on interest rate cut in 2024

CME Bitcoin futures options expire on the same day as the underlying Bitcoin futures contract, i.e. the last Friday of each month. Bitcoin futures trading volume on CME reached $41 billion as of December, according to data from The Block.

“Traders in futures markets are increasing their bets on interest rate cuts, speculating that rates will be cut as early as March and further declines over the next year,” Bitfinex analysts told The Block.

This forecast is consistent with data from the CME FedWatch tool, which gives a 66.7% probability that the U.S. central bank will cut interest rates by 25 basis points in March 2024.

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