Bitcoin Futures at Kraken-Owned Exchange Top $1 Billion in First Month

Bitcoin futures Kraken exchange cryptocurrencies

Futures trading on the Kraken-owned Crypto Facilities exchange has hit $1 billion in the first month, spanning a range of five major cryptocurrencies including bitcoin.

Sui Chung, head of indices and pricing products at Crypto Facilities, said trading volumes had increased by over 500 percent since the firm was acquired by Kraken for $100 million at the start of February.

The takeover is the latest in a series of acquisitions by Kraken, which has continued to grow despite the bear market in bitcoin and other cryptocurrencies.

Chung said the exchange had seen a four-fold increase in customer numbers since Kraken took control of the company last month.

“I think obviously having the support of a major U.S. exchange helped and obviously Kraken bringing our product set to a very loyal user base … that Kraken branding carries a lot of weight … and also the fact that because we run contracts on the major five coins and take collateral on the major five coins.”

Chung said the growth in trading volume was not restricted to bitcoin markets, with several other minor cryptocurrencies showing similar demand pressures since February.

“On average, the five days before the announcement and five days after, the liquidity for our contracts increased by over 200 percent and some of the minor (coin) contracts increased by over 1,000 percent.”

One of the largest global cryptocurrency exchanges, Kraken brings substantial liquidity to key coin markets, which Chung said was in part responsible for the surge in volume across its non-bitcoin markets.

Futures trading allows investors to speculate on future prices in cryptocurrency markets, providing scope for margin trading and short selling.

An alternative to directly owning cryptocurrency, futures appeal to institutions that want to speculate on crypto markets without buying and storing cryptocurrency outright.

Crypto futures have already proved appealing to investors since they were first launched in December 2017.

With Crypto Facilities now part of the Kraken group, it looks set to continue to grow in the number and volume of crypto futures traded through its exchange platform.