314% growth in crypto derivatives trading in Q1 of 2020

A TokenInsight study shows that total futures trading in the crypto industry reached more than $ 2.1 trillion in the first quarter of 2020.

This is a 314% increase over the 2019 average.

According to the “Crypto Derivatives Exchange Report for the first quarter of 2020”, with the exception of a slight decline in Q4 2019, the volume of trading in cryptocurrency futures increased in 2019 The total market turnover in Q1 2020 is approximately eight times higher than Q1 2019.

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

The average daily trading volume jumped

The average daily trading volume for the whole market in the first quarter of 2020 reached $ 23.3 billion. This represents a 274% increase over 2019.

Researchers responsible for preparing the report commented on the following:

“We believe that cryptocurrency futures already have some attributes of market leading indicators and spot market players can rely on the volume of trading futures for position management.”

The study also points out that the correlation coefficient between futures and spot trading volume has fallen to 0.31. This compares to 0.76 registered in the fourth quarter of 2019.

Futures trading correlates with spot market fluctuations

When the futures market is abnormally traded, the study highlights that the spot market is subject to significant fluctuations.

“Investors must now adjust their positions. In addition, in a market downturn, only when the futures volume finally shrinks can the market survive a significant upswing. “

A study quoted by the Cointelegraph on April 21 reports that Binance Futures emerges as the biggest winner of the futures market after the Black Thursday sale.

By that time, Binance had reached $ 2.8 billion in Bitcoin futures volumes in just 24 hours. Their results surpassed those of both BitMEX ($ 2.1 billion) and Huobi ($ 2.46 billion).