Institutional activity on CME fell amid collapse in markets

Institutional investors seeking a safe haven amid the global spread of coronavirus are notEspecially in a hurry to turn to Bitcoin. These observations were shared by The Block analysts.

Various media and experts from social networks BitcoinFor a long time it was presented as an uncorrelated asset, the price of which does not follow other financial instruments, including stocks. Some experts regarded the first cryptocurrency as a safe haven, in which turbulence in traditional markets can be waited with benefits.

“The dynamics of the market last week and the disclosure of the distribution of coronavirus tested these theses”, - note analysts of the publication.

After the deepest daily decline in oil prices over the past 30 years, the Dow Jones Industrial Average index dipped by more than 7% at the opening of trading.

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The S&amp;P 500 “barometer of the American economy” also fell by 6.9% in the first minutes of trading. Due to such a sharp drop, trading was suspended for 15 minutes.

The shares of oil companies fell the most in the three minutes of trading: ConocoPhillips - 26%, Chevron - 14.47%, ExxonMobil - 14.2%.

Today, March 9, Bitcoin fell below $ 8,000, pulling a wider market. The capitalization of the latter dipped by about 10%.

The chart below shows that since the beginning of February, BTC has been falling almost synchronously with the S&amp;P 500:

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Moreover, traditionally defensive assets are gold,US government bonds and the yen - are growing up. By the way, yields on 10-year treasury bonds on March 9 for the first time in history fell below 0.5% per annum.

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The graph below shows that the correlation of bitcoin with gold is close to zero:

Data: CoinMetrics

Analyst Ryan Todd notes that if the first cryptocurrency was a real protective asset, then we could expect an increase in trading volumes on the CME exchange:

“If you study the data on bitcoin futures on CMEGroup, which, in my opinion, is now the simplest and cleanest product for traders, traditional hedge funds and large asset managers, you will see small volumes and open interest over the past two weeks. "

Indeed, according to CFTC, the number of open positions on bitcoin futures on the CME exchange is rapidly falling:

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&#8230;Activity is especially decreasing among relatively large participants in futures trading:

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Trading volumes have been steadily falling since mid-February:

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Peak RPMs at CME reached on the evereaching peak levels with American stocks (February 19). After that, the trading volume of bitcoin derivatives collapsed by 75%, reaching the lowest rates in 2020.

Recall, recently VanEck digital asset strategist Gabor Gurbach expressed the opinion that the era of negative rates promises good times for bitcoin.