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TL;DR
‘Futures contracts’ are mainly bets on whether or not a inventory/asset (e.g. Bitcoin) goes to go up or down by a set date sooner or later.
The extra bets, the upper the ‘open curiosity.’ The upper the open curiosity, sometimes the upper Bitcoin’s value climbs.
Open curiosity in Bitcoin futures simply jumped from ~$8 to ~$10B – that is the best it has been for the reason that bear market started in Might of final yr!
Which implies both new cash is flowing into the market, or present contributors are rising their investments.
Whichever approach you slice it: extra open curiosity = extra money flowing into Bitcoin. We like to see it!
Full Story
You know the way when the housing market is sizzling, there is a greater quantity of bids positioned on houses?
And when it is cooling off, the quantity of bids goes down?
(I.e. Extra bids = greater costs).
Within the futures market, this ‘bid quantity’ is named ‘open curiosity.’
ICYMI yesterday: futures contracts are agreements from merchants to purchase or promote an asset (e.g. Bitcoin) at a set value on a particular date.
(They’re mainly bets on whether or not a inventory/asset goes to go up or down by a set date sooner or later).
With regards to Bitcoin, the quantity of ‘open curiosity’ is usually mirrored in Bitcoin’s real-time value.
Or higher but:
If extra bets are made on the long run BTC value, the present value goes up. If much less bets are made on the long run BTC value, the present value goes down.
Full disclosure: this is not an ideal description, and we’re skimming over lots of the complexities right here – however the correlation exists!
Simply examine this Bitcoin chart out:
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