{"id":88116,"date":"2020-10-13T16:34:15","date_gmt":"2020-10-13T13:34:15","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/competition-for-global-crypto-derivatives-market-dominance-heats-up\/"},"modified":"2020-10-13T16:34:15","modified_gmt":"2020-10-13T13:34:15","slug":"competition-for-global-crypto-derivatives-market-dominance-heats-up","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/competition-for-global-crypto-derivatives-market-dominance-heats-up\/","title":{"rendered":"# Competition for global crypto derivatives market dominance heats up"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_85 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a373b7914419\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a373b7914419\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/competition-for-global-crypto-derivatives-market-dominance-heats-up\/#What_fueled_Binance_Futures_rise\" >What fueled Binance Future\u2019s rise?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/competition-for-global-crypto-derivatives-market-dominance-heats-up\/#OKEx_stages_a_comeback\" >OKEx stages a comeback<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/buradabiliyorum.com\/en\/competition-for-global-crypto-derivatives-market-dominance-heats-up\/#UK_ban_on_local_derivatives_market_could_hurt\" >U.K. ban on local derivatives market could hurt<\/a><\/li><\/ul><\/nav><\/div>\n<p>&#8220;<strong># Competition for global crypto derivatives market dominance heats up <\/strong>&#8221;<\/p>\n<div data-v-17f60ba6=\"\">At the start of October, the crypto market was faced with extremely tumultuous financial conditions, thanks in large part to the recent filings against BitMEX, which saw the company\u2019s top brass being indicted by the United States Commodity Futures Trading Commission on several charges. Not only that, but just a few days before the BitMEX scandal came to light, cryptocurrency exchange KuCoin was hacked to the tune of over $275 million on Sept. 26.<\/p>\n<p>In the midst of all this, the crypto derivatives market also witnessed a major development in the form of Binance overtaking Huobi and OKEx to become the largest crypto derivatives exchange by volume for the month of September, with the platform recording a total trade volume of $164.8 billion for the month.<\/p>\n<p>The data, released by U.K.-based crypto analytics firm CryptoCompare, took into consideration the trading volume of the aforementioned exchanges and found that Binance drew in a total of $8 billion more in trade volume than its closest competitor, Huobi, which raked in $156.3 billion during the same time period, while OKEx drew in around $155.7 billion.<\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.eu-central-1.amazonaws.com\/s3.cointelegraph.com\/uploads\/2020-10\/103206e6-11f1-48ca-8c7b-bcf8aeb8fabc.png\"\/><\/figure>\n<p>Binance and OKEx demonstrated relatively similar derivatives volumes during July and August; however, it\u2019s worth noting that during this same time window, Huobi had quite a margin on both its closest rivals. This then poses the question of how Binance was able to make such strides in just one month to overtake Huobi and OKEx so quickly. Providing his thoughts on the subject, Jay Hao, CEO of OKEx, told Cointelegraph:<\/p>\n<blockquote><p>\u201cBinance held a $1.6 million trading competition on its futures exchange to mark its one year anniversary in September. This may have led to the sudden rapid spike in volume and also explain why the OI is so low compared to OKEx, as traders did not open long positions but were competing for their share of the prize pool.\u201d<\/p><\/blockquote>\n<h3><span class=\"ez-toc-section\" id=\"What_fueled_Binance_Futures_rise\"><\/span>What fueled Binance Future\u2019s rise?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>According to a Binance spokesperson, one of the key drivers that helped spur the recent market performance was user feedback, especially in regard to the less-than-ideal trading experiences that many customers had previously faced on other derivatives exchanges: \u201cThey told us about system outages or instability, interfaces that weren\u2019t user-friendly, and that all the exchanges then were only offering incentives for market makers, which created a lopsided environment that disadvantaged market takers.\u201d<\/p>\n<p>Another event that may have bolstered market confidence in Binance\u2019s derivatives arm was Black Thursday, or March 12, a day that greatly impacted both traditional and crypto markets. While many other derivatives exchanges encountered significant outages, Binance offered uninterrupted service to its customers, thereby potentially cementing confidence in the platform.<\/p>\n<p>Lastly, during the course of summer this year, a number of users moved from Bitcoin to various altcoins and DeFi-based derivatives. During this transitional phase, Binance Futures expanded its offerings pool. The Binance spokesperson noted: \u201cThere\u2019s also better awareness on how we balance Bitcoin and altcoins; altcoin futures volumes make up around 40% on Binance. We think we understand and reflect market conditions well.\u201d<\/p>\n<h3><span class=\"ez-toc-section\" id=\"OKEx_stages_a_comeback\"><\/span>OKEx stages a comeback<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>While September saw Binance lead the derivatives roost, heading into October, OKEx is leading all Bitcoin futures exchanges in terms of Bitcoin futures open interest. In its most basic sense, open interest signifies the total number of outstanding derivative contracts \u2014 be it options or futures \u2014 that are yet to be settled. From a more technical standpoint, open interest serves as an indicator of options trading activity and whether or not the total amount of money coming into the derivatives market is increasing.<\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.eu-central-1.amazonaws.com\/s3.cointelegraph.com\/uploads\/2020-10\/65de473d-8938-44c4-aedc-c6a3a41c14f6.png\"\/><\/figure>\n<p>On Oct. 4, OKEx\u2019s 24-hour trading volume was over the $1.3 billion mark, dwarfing the $1.23 billion trade volume of its closest competitor, Binance Futures. Additionally, as can be seen from the chart above, open interest on OKEx is the highest by a wide margin, with the other five exchanges performing similarly to one another.<\/p>\n<p>Such positive statistical data seems to suggest that BTC futures and options sentiment has remained quite strong, despite the recent BitMEX lawsuit and KuCoin hack. Not only that, but OKEx\u2019s futures open interest has risen from $850 million to $930 million since the start of October, something that is potentially indicative of a bull run in the near future. Providing his insights on the subject, Hao told Cointelegraph:<\/p>\n<blockquote><p>\u201cTrading volume is a very important metric but it is not the only metric to keep in mind when assessing the overall health and popularity of an exchange. OKEx has been laser-focused on DeFi lately as well and this move from Binance in derivatives is a signal for us that we cannot take our attention from our flagship product.\u201d<\/p><\/blockquote>\n<h3><span class=\"ez-toc-section\" id=\"UK_ban_on_local_derivatives_market_could_hurt\"><\/span>U.K. ban on local derivatives market could hurt<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>On Oct. 11, the United Kingdom\u2019s Financial Conduct Authority \u2014 the country\u2019s principal finance regulator \u2014 issued a blanket ban prohibiting crypto service providers from selling derivatives and exchange-traded notes to retail investors. While the U.K. derivatives market may not be large in comparison to others, the fact that a prominent regulator such as the FCA continues to <a rel=\"nofollow noopener noreferrer\" target=\"_blank\" href=\"https:\/\/www.fca.org.uk\/publications\/policy-statements\/ps20-10-prohibiting-sale-retail-clients-investment-products-reference-cryptoassets\">claim<\/a> that \u201ccryptoassets are causing harm to consumers and markets\u201d is rather alarming for the industry.<\/p>\n<p>The government agency is still alleging that digital assets have no inherent value \u2014 an argument that has been used against crypto since its inception. Moreover, another reason for the ban is the \u201cextreme volatile nature\u201d of crypto, which seems like another unjust evaluation considering the same can be said about many traditional stock options. The FCA claims that retail investors \u201cdo not understand enough about the derivatives market,\u201d so there is no real need for them to invest in such offerings.<\/p>\n<p>That being said, it is worth remembering that when the ban was proposed in July last year, it generated a total of 527 responses from various companies that sell derivatives as well as crypto exchanges, law firms, trade bodies and other entities. In a 55-page <a rel=\"nofollow noopener noreferrer\" target=\"_blank\" href=\"https:\/\/t.co\/RoXHrHh9jm\">report<\/a> released by the FCA, a staggering 97% of respondents are shown to have opposed the proposal.<\/p>\n<\/div>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong>\n<\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">News<\/a> articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/general\/\" target=\"_blank\" rel=\"noopener noreferrer\">General category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"https:\/\/cointelegraph.com\/news\/competition-for-global-crypto-derivatives-market-dominance-heats-up\" target=\"_blank\" rel=\"noopener noreferrer\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8220;# Competition for global crypto derivatives market dominance heats up &#8221; At the start of October, the crypto market was faced with extremely tumultuous financial conditions, thanks in large part to the recent filings against BitMEX, which saw the company\u2019s top brass being indicted by the United States Commodity Futures Trading Commission on several charges&#8230;.<\/p>\n","protected":false},"author":1,"featured_media":88117,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/s3.eu-central-1.amazonaws.com\/s3.cointelegraph.com\/uploads\/2020-10\/6e88a587-9aaa-4551-99d6-04198fa1aa27.jpg","fifu_image_alt":"","footnotes":""},"categories":[1],"tags":[75014,74862,74993,75012,75591,75592],"class_list":["post-88116","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general","tag-binance","tag-bitcoin","tag-bitmex","tag-derivatives","tag-huobi","tag-okex"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/88116","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=88116"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/88116\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/88117"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=88116"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=88116"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=88116"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}