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- Binance officially announced that, for the first time, the trading volume of the Binance futures market, at around 30,500 Bitcoin (BTC), exceeded the spot market’s trading volume.
Binance published its trading platform for Bitcoin futures around three weeks ago. Since then, Binance has recorded increasing interest in its BTC futures. As the CEO of Binance, Changpeng Zhao, has now announced, the 24-hour trading volume of Bitcoin Futures has reached a new all-time high today and has even overtaken the trading volume of the spot market.
The 24-hour trading volume of Binance’s futures markets has exceeded 30,500 BTC, equivalent to approximately USD 252 million. On the other hand, according to Coinmarketcap data, the trading volume of the spot market was relatively low at around USD 212 million. The trading volume of BTC Futures has thus exceeded the trading volume of BTC on the Binance spot market for the first time.
On Bitcoin’s futures market, prices are not settled immediately. Instead, two parties trade on the contract, with settlement on a future date when the position is liquidated.
Right from the start, the launch of the Binance Futures platform was very successful. In the first 24 hours after the launch, Binance recorded trades worth approximately USD 170 million. The figures were close to the trading volume recorded during the beta phase (around USD 150 million on average). This made Binance the fifth largest Bitcoin Futures trading platform on the first day, according to Skew Markets. However, Binance’s volume lagged significantly behind the market leaders BitMEX and bitFlyer, which recorded significantly higher trading volumes of $2.52 billion and $860 million, respectively.
Binance spot market loses 20% of trading volume
According to Coinmarketcap figures, Bitcoin’s trading volume on the Binance Spot Market has fallen by around 20 percent in the last 24 hours. This raises the question of whether investors will switch from the spot market to the Binance derivatives market. This could be due to the fact that Bitcoin is currently struggling with a bearish market. On the other hand, investors could try to predict BTC’s future price movements, shifting attention to futures trading.
Another incentive for traders is certainly Binance’s 20x leverage. The leverage effect makes it possible to hedge spot or holding risks on the futures market with relatively low capital expenditure and at the same time achieve higher profits.
In addition, Binance is currently conducting a number of advertising campaigns to promote the Binance Futures. Users can currently purchase up to USDT 20 (tether) if they deposit USDT 10 to their futures account as a first step. In the second step, users must deposit 500 USDT to receive another 10 USDT for free. In addition, users will receive a 50% discount on trading fees for the first three months.
Whether the trend towards Bitcoin’s futures market trading will be sustained remains to be seen. In addition, it will be interesting to observe how Binance will perform in comparison to its competitors bitFlyer and BitMEX in the future. BitMEX currently offers the highest margins with up to 100x leverage, while Binance only has 20x leverage. This potentially makes it a less attractive option for investors with higher risk tolerance.
