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The total volume of crypto derivatives increased by 314% in the first quarter of 2020 compared to the average in the fourth quarter of 2019

A study by TokenInsight reports that the total volume of futures trading in the crypto industry reached over $ 2.1 trillion in the first quarter of 2020. This is an increase of 314% compared to the fourth quarter 2019 average.

According to the “Report of the Cryptocurrency Derivatives Exchange Industry of the First Quarter 2020”, Except for a slight decline in the fourth quarter of 2019, trading volume in cryptocurrency futures increased in 2019. Total market sales in the first quarter of 2020 are approximately eight times higher than in the first quarter of 2019.

To analyze the trading volume, TokenInsight included BitMEX, OKEx, Huobi DM, Binance Futures, Deribit, Bitget, Binance JEX, FTX, Gate.io, BFX.NU, BitZ and KuMEX in addition to some emerging derivatives exchanges.

The average daily trading volume increased

The total volume of crypto derivatives increased by 314% in the first quarter of 2020 compared to the average in the fourth quarter of 2019
The total volume of crypto derivatives increased by 314% in the first quarter of 2020 compared to the average in the fourth quarter of 2019

The average daily trading volume of the entire market reached $ 23.3 billion in the first quarter of 2020. This corresponds to an increase of 274% compared to 2019.

The researchers responsible for preparing the report commented on the following:

“We believe that crypto futures already have some attributes of leading market indicators, and spot market participants can refer to the volume of futures trading for position management.”

The study also shows that the correlation coefficient between the futures trading volume and the spot trading volume has dropped to 0.31. This is compared to 0.76 in the fourth quarter of 2019. The researchers concluded that This phenomenon explains that the participants in the futures market were “possibly relatively independent” of the spot.

Trading on the futures markets correlates with fluctuations on the spot market

If the futures market is unusual, the study shows that the spot market is subject to considerable fluctuations.

On the same line, the report says:

“At this point, investors have to adjust their positions. Even in the downturn of the market, the market can only experience a significant recovery when the future volume finally decreases.”

A study cited by Cointelegraph on April 21 reported this Binance Futures became the biggest winner in the futures market after the massive sale of Black Thursday.

At that point, Binance reached $ 2.8 billion in bitcoin futures volume in just 24 hours. Their results exceeded those of BitMEX (2.1B) and Huobi (2.46b).

According to Coin Metrics, the Bitcoin Open Interest Share (BTC) from Binance Futures rose from around 10% in mid-March to almost 25% on April 12.

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