Bitcoin futures volumes on US exchange Bakkt hits record

Bakkt, the fully-regulated institutional US exchange for cryptocurrencies, reported the highest-ever volume for its Bitcoin futures product yesterday, after several dismal months.

Bakkt said it traded over $200 million in its 15,955 Bakkt Bitcoin futures product on Tuesday, a 36% increase from its previous all-time high.

15,955 Bakkt Bitcoin Futures were traded today, representing over $200M of volume and a 36% increase from our previous all-time high 📈. - Bakkt September 15, 2020.

The daily volume on Bitcoin futures on Binance and OKEx was over $2.3 billion and $2.1 billion respectively on Tuesday alone - ten times as much as Bakkt's, as per data on on-chain analytics firm Skew.

The open interest on Bakkt - a metric that calculates the number of contracts or commitments outstanding in futures and options trading on an exchange at any time - was just $13 million.

Still, the $200 million on Bakkt shows substantial interest from regulated firms interested in gaining exposure to Bitcoin with Bakkt's physically-delivered futures product - one that deposits Bitcoin to investors upon expiry instead of US dollars.

The purchase brought the firm's total Bitcoin holdings to be valued at over $375 million, with MicroStrategy touting Bitcoin's properties as a hedge against inflation on traditional currencies as a reason behind its decision.

The exchange's main selling point - that of physical-settled Bitcoin futures - turned out a disappointing farce.

Reality: Bakkt futures 37% backed by dollars or treasuries.

Still, with the volumes it recorded yesterday - it may be wise to write off Bakkt as a contender in the Bitcoin futures space just yet.