Crypto Derivatives: CME Volume Crashes 89% in 3 Days, SEC to Rule on ETF

Published at: Feb. 24, 2020

Daily trade volume for Chicago Mercantile Exchange (CME)’s bitcoin (BTC) futures produced a new low for 2020 on Feb. 21, with $118 million worth of contracts changing hands on Friday.

The record low came just three days after CME daily volume exceeded $1 billion for just the third time in the market’s history, with CME bitcoin futures producing over 23,000 contracts or $1.1 billion worth of trade on Feb. 18.

Daily trade volume for CME bitcoin futures. Source: Skew

Despite the near-record spike in trade activity, CME bitcoin futures volume quickly faded, plummeting by nearly 55 percent the next day. Feb. 20 saw an almost 58% drop, with daily volume falling from $499 million to $211 million.

On Feb. 21, CME bitcoin volume fell by roughly half for the fourth day in a row, with a further 44% contraction. In total, CME bitcoin volume dropped by 89% in half a week.

The single strongest day of trade on record for CME’s BTC futures took place on May 13, 2019, with $1.3 billion worth of contracts exchanged as BTC tested $8,000 for the first time in 10 months. Daily trade for the contract exceeded $1 billion for the second time on June 27, 2019 – when BTC rallied by $1,500 intraday to post 2019’s high of nearly $13,800.

SEC to rule on Wilshire Phoenix Bitcoin ETF

The U.S. Securities and Exchange Commission (SEC) scheduled to make a ruling on Wilshire Phoenix’s proposed Bitcoin exchange-traded fund (ETF) on Feb. 26, the sole active application for a bitcoin ETF currently under SEC consideration.

Despite many crypto analysts dismissing the prospects of Wilshire Phoenix’s Bitcoin and Treasury Investment Trust being approved, the firm's founder, Bill Herrmann, recently told Cointelegraph that the company has “continued to have thoughtful and meaningful discussions with the commission.”

Wilshire Phoenix first submitted a proposal for the bitcoin ETF on June 12, 2019. On Sep. 24, 2019, the SEC initiated proceedings pertaining to the ETF, however, the firm updated its filing the following month in partnership with NYSE Arca, with Coinbase listed as the product’s custodian. At the end of 2019, the SEC extended proceedings until Feb. 26.

On Feb. 14, Wilshire Phoenix updated its filing, including the firm’s fees – $2,437, the number of shares it initially intends to register – 8,040, and its maximum share price  – $2,500.

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