Market Wrap: Bitcoin’s Price Up 12% Since the Halving

Bitcoin has seen steady gains in price since the halving took place on May 11. The number of institutional investors trading in the CME crypto options market is a sign of continued interest in this asset class.

At press time, bitcoin’s price has risen 12% since the reward for bitcoin miners was cut in half.

Over the past 24 hours, bitcoin (BTC) was trading up 6% at $9,689. The world’s first cryptocurrency is chugging higher, with technical indicators including the 10-day and 50-day moving averages above bullish levels since May 13.

Bitcoin trading on Coinbase since May 12
Source: TradingView

Mark Warner, head of trading for crypto brokerage BCB group, told CoinDesk the price gain is due to continual interest in bitcoin as an asset class, and that the uncertain future faced by miners will take time to shake out.

“Broadly speaking, we expect demand for bitcoin to continue growing incrementally and it will take some time for the supply shock to work its way through the market and be reflected in price,” he said.

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Bitcoin options open interest on CME, or the total number of outstanding contracts, have spiked since May 5, a sign of institutional interest. On Thursday, options open interest reached a high of $105 million, a huge jump considering average daily interest has been a paltry $13 million since Jan. 13 when first launched on CME.

Options open interest on CME since the platform began offering the instrument
Source: Skew

Trading on the CME is generally done by well-capitalized investors with experience trading derivatives. The rise in open interest is likely coming from that subset of the market, said Vishal Shah, an options trader and founder of derivatives exchange Alpha5.  “Whoever is behind these purchases is clearly a sophisticated trader,” he said.

The bitcoin activity uptick on the CME is from traders making bullish bets, says Shah. “The interest is in higher…

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