It’s not just bitcoin futures products that are becoming popular with investors, at least according to one U.K.-based crypto derivatives provider.
Crypto Facilities, a subsidiary of the San Francisco-based exchange Kraken that provides bitcoin and ether reference data for CME Group and has offered its own derivatives products for years, has seen trading volume in its altcoin futures markets jump dramatically in recent weeks – in particular, its litecoin and bitcoin cash futures contracts, said head of indices and pricing products Sui Chung.
He told CoinDesk that the company had seen a dedicated following for each coin since litecoin was listed in June 2018 and bitcoin cash two months later, “but relative to bitcoin and ether [those contracts] were pretty small in terms of volume.”
This changed after Kraken acquired the startup earlier this year.
“We began to onboard Kraken users … [and] that’s basically given us better exposure to the communities around litecoin and bitcoin cash, and I think what we’re seeing is those communities have a pretty strong interest in trading derivatives for litecoin and bitcoin cash, respectively,” Chung said. “The volumes have gone up pretty appreciably.”
Prior to the acquisition, Crypto Facilities saw its litecoin futures contracts average around $15 million in notional volume each month, while its bitcoin cash contracts saw roughly $10 million per month.
By contrast, last month, the litecoin product saw $100 million notional volume, while bitcoin cash was just under $50 million, Chung said.
Chung does not think that Kraken’s userbase is the sole contributor to the increasing volumes, but rather just one of a number of factors.
In particular, he stressed that Crypto Facilities is one of the few – if not only – exchanges that offer regulated altcoin futures contracts that pay out in the underlying cryptocurrencies. Speaking to litecoin and bitcoin cash specifically,…