Both when the CBOE future expired and today, if the CME bitcoin future is on its way settlement, there was clearly a considerable reduction in the bitcoin price. Both futures has a serious low volume and that i would estimate that they’re covered with a unitary liquidity provider\/market maker. Forex trading maker is probably short the long run and perhaps long lots of. At expiry, they’ll profit if the costs are low and have a border after settlement if the cost rebounds. Sadly both CME and CBOE has chosen an incredibly bad settlement processes which can be easy to manipulate. For CBOE it’s the auction price for Gemini – a tender which has a tiny volume more often than not.
CME’s model is way better, but still of low quality, VWAP around the four major exchanges is a good idea, but if that VWAP is calculated on one minute of trading it’s meaningless. With few large participants, the volume on such a brief time period is incredibly limited. Even though many large participants might have interests in different of these settlement processes they’d probably have the same position and advantages of exactly the same side with the market manipulation. The VWAP have to have been calculated over a long time instead). The conclusion is that we likely will see a lots of strange market activity around each future expiration and expect a rebound after 3 pm Central time today!.
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