CME Group, the world’s leading derivatives marketplace, saw a 24% increase in crypto options trading volume in July, according to data tracked by CCData. This marks the first increase in four months and is attributed to investor demand for hedging tools. Bitcoin (BTC) options trading rose 16.6% to $734 million, while ether (ETH) options trading saw a 60% increase to $207 million.
The increase in BTC options volume on the CME suggests that institutions might be hedging their positions with options as uncertainty remains in the market, CCData said in a report. Options are derivative contracts that give the purchaser the right to buy or sell the underlying asset at a predetermined price on or before a specific date. CME offers bitcoin and ether options based on the exchange’s cash-settled standard and micro BTC and ETH futures contracts.
The combined activity in CME BTC and ETH futures cooled in line with the global slowdown. Futures volume on CME registered a 17.6% decline to $39.1 billion, while total derivatives trading volume (futures and options) fell 17.0% to $40.1 billion. The combined crypto spot and derivatives trading volume on centralized exchanges fell 12% in July to $2.36 trillion.