The Chicago Mercantile Exchange Group (CME Group) wants to allow traders in its Bitcoin futures market to open larger positions. Notification of the intention to increase the monthly limit on BTC futures by CME was sent to the U.S. Commodity Futures Trading Commission (CFTC) on Thursday.
It is assumed that the limit will be raised from 1,000 contracts per month to 2,000 for one investor. Since each contract corresponds to five bitcoins, it means that the limit on positions will be increased to $100 million at the current rate of cryptocurrency conversion.
The average daily trading volume is currently only 7,100 contracts. Nevertheless, the company sees opportunities for growth "on the background of significant acceptance of the futures market and analysis of the underlying Bitcoin market".
If the CFTC does not object, the decision will come into force on September 30 and will apply to October contracts.
According to the CFTC, position limits are set in order to contain "excessive speculation" on any exchange commodity, which forms the basis of futures. "As a general rule, position limits are required for markets where the threat of manipulation is insignificant or very small," explains the CFTC on its website.
According to the CME, currently 56 large position holders are involved in Bitcoin futures trading, a record for this market. Since the beginning of the year, more than 1,200 traders have joined the platform.