Futures Markets: Volume harmful for Bitcoin
As Bitcoin rose from $1 to $20,000 most of the Crypto community was convinced that Bitcoin is going to crush the US Dollar and establish a new financial system. The assumption was that the Powers-that-be will just sit there and watch Bitcoin take over the world. Unfortunately, the Financial system does not work that way, folks.
In Feb–2018 I wrote Cartel post. Most of the people rejected this idea that cartel is going to bring down the price of Bitcoin. Unfortunately, everything happened as expected and the crash that started on the night of CME launch is still in progress.
Finally, After 83% Drop Andreas Antonopoulos talked about “Global Banking Cartel”
It took 12 months and 83% of drop for people to accept the fact about the “Global Banking Cartel”. And during this time most people missed the biggest opportunity of their life by denying the existence of the Cartel.
San Francisco Fed: “Bitcoin drop tied to CME Listing”
San Francisco Fed May-2018 research paper that states “The rapid run-up and subsequent fall in the price after the introduction of futures does not appear to be a coincidence” four researchers wrote.
If CME has no volume, how can it affect the price?
It is true that CME has very negligible volume. If so, how could a small volume affect the price?
This is where Cartel came into the picture in the initial stages. They pumped the price very high, from 2K to 20K; collected lots of Bitcoin and successfully dropped the price since then. This price pressure will continue until the volume builds on Futures exchanges (CME, Nasdaq etc.) We may possibly have another huge rally that will burn many folks, once again.
This is from someone on the Gold/Silver side explaining how Bitcoin is being manipulated down. We can learn it from those who have experienced it first-hand for 8 years — this is by TFMetals —
Why Volume Matters?
Futures are all about “Volume”. Prices can be controlled only when Futures have extremely high volume where the intrinsic (real) value is suppressed by the subjective (confidence) price. This is called tail-wagging-the-Dog on the Wall street. (Watch this video by Jim Rickards where he explains how intrinsic (real) value is suppressed by subjective (confidence) price (starts at 3.25 min). Its simply how financial markets work in the 21st century people, unbelievable but true.
The volume on CME and COBE is very little as compared to Bitmex. Cartels cannot do anything unless volume grow on these CME and COBE. Here is chart of Futures volume in Q4–2018.
Why Futures market pressure physical price?
Very simple explanation by @LukeGromen
Bitcoin Futures Overtake Coinbase Trading Volumes
CME’s fiat settled bitcoin futures have overtaken Coinbase Pro spot bitcoin trading volumes for the first time recently.
How the volume is growing?
[Following chart/link/info updated Dec-2018]
CME Group reports Bitcoin Volume and Interest up in November-2018
[Following chart/link/info updated Apr-2019]
What Caused Bitcoin Flash Crash on May-16–2019?
[Following chart/link/info updated May-2019]
Cryptos suddenly jerked lower with Bitcoin flash-crashing over 15%, sliding as low as $6,395 on Bitmex XBTUSD perpetual swap. $12bln going through on the futures side in last 24h
Volumes of other commodities in Futures markets
What is Bitcoin volume compared to others? It’s absolutely negligible, and still we saw a huge price drop since CME was launched.
Lets compare in Dollar value
GOLD:
509,551 contracts on CME = $61 Billion
BITCOIN:
8,349 contracts (COBE+CME) = 13,177 Bitcoins = $158 Million
Gold has 300 times more Futures volume than Bitcoin. Do you known what happens when Bitcoin volume becomes $61 B? Increasing volume on Futures markets does NOT bode well for Bitcoin price (or any market for that matter.)
Gold Futures market Suppression chart
Have you ever seen a market where price is crashing on rapidly rising demand — Behold, Gold is the one!!
→ Chinese Gold imports have gone parabolic since 2011
→ Gold Price has crashed 40% since 2011
Nasdaq confirms it will list Bitcoin Futures
There is no good news in this, friends. Anything named “FUTURES” is not good for Bitcoin, Gold and Silver. In my view, this is going to increase paper supply of Bitcoin. Time will answer all questions.
CME Future market will create 210 million Paper copies of Bitcoin
Most think there are only 21 Million Bitcoins. Not true, because Wall st has already devised a solution for scarcity of any commodity. They are currently trying to apply that solution to bitcoin.
Fractional Reserve, Rehypothetication & Commingling create multiple copies of commodity that will be traded on the Futures markets which WILL suppress the price of Bitcoin. The same happened with Gold & Silver. Results will NOT be different for Bitcoin if volume builds on Futures markets. Read my End of 21 Million Bitcoins as you know it
Here is my pinned tweet from Dec-01.2017
I wish I am wrong in everything I write, but I must share what I see — Suppression and Stagnation probably for years.
More on my twitter handle @Super_Crypto:
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