Financial instruments will catapult BTC to 10 billions of dollars: analyst

Derivative products, such as options of options – financial instruments that give investors good but not the obligation to buy or sell an active price at a predetermined price – will lead the Bitcoin market capitalization (BTC) to at least 10 billions of dollars, according to market analyst James Van Stratot.

Van Stratot said that options and other derivatives attract institutional investors and the high volatility cushion markets which is a characteristic of digital assets.

He underlined an open interest in term contracts on the BTC on the Mercantile Chicago Exchange (CME), the largest derivative market in the world, as proof of a change. Van straten wrote:

“The open interest of CME options is at a record level, partly motivated by systematic volatility sales strategies such as covered calls.

Reduced volatility operates in both directions, and the crushing titles common to cryptographic markets will also amortize meteoric gains that traders have used, added Van Stratten.

Market analysts continue to debate the effects of financial products and investment vehicles on the Bitcoin market cycle and the wider market of cryptography, some arguing that all signs indicate market maturation, while others say that investors’ psychology is the real undercurrent current that evolves markets.

In relation: “ Bigger Bull Catalyst ” of Bitcoin could be the next choice of Fed chair: Novogratz

Does the four-year market cycle dead?

Analysts remain divided on the effect that institutional investors, investment vehicles and financial derivatives have in the cryptographic markets.

Seamus Rocca, CEO of the financial service company Xapo Bank, told Cintelegraph that the four -year market cycle of Bitcoin is not dead and that the markets will continue to be influenced by information cycles, the feeling of the crowd and the psychology of investors.