The Bit.com team, which claims to be a stable and "high-performance" exchange of cryptocurrency derivatives launched by Matrixport, will reportedly offer perpetual swaps and options for Bitcoin Cash (BCH).
The Bitcoin Cash option trading is scheduled to start on Feb 1 2021 on Bit.com, as stated in a release shared with various crypto media, which will be right after the launch of the perpetual swaps on Jan 20, 2021.
As noted in the update, in the crypto and blockchain industry, Bit.com's offering of the Bitcoin Cash or BCH options is "the first of its kind." The largest Bitcoin fork, Bitcoin Cash, has been more commonly accepted and is recognised by organizations such as Grayscale and has managed to place No. 6 or 7 on the top crypto list.
At the time of writing, with BCH trading at about $455, Bitcoin Cash has a market cap of between $8 billion and $9 billion, down considerably from its all-time peak of over $3,600.
As mentioned in the release, BCH (presumably due to low demand) has no options market and the liquidity of the perpetual swaps "also has room for improvement."
The market is dominated by BTC (which is around 90 percent), whereas the rest is taken up by Ethereum or ETH, similar to cryptocurrency options. The option market is currently almost non-existent for other digital assets or altcoins. To sum up, according to the release, the BCH derivative market is "far from maturity compared to its size and underlying price volatility."
Now this "gap in the market will soon be filled" with the product launch of Bit.com.
Bit.com describes itself as an exchange of institutional-grade derivatives launched by Matrixport, a Singapore-based "one-stop" financial services company. "Bit.com has sold BTC and ETH perpetual swaps and options since its launch in August last year, which are "greatly embraced and actively traded by both institutional and individual users," the company says.
Bit.com's overall transaction volume exceeded $6 billion within the first 5 months of its launch, and is now on its way to attempting to grab a greater market share. The exchange records trading volumes of $100-200 million per day at present. Yet CoinGecko.com data shows just $25 million in 24-hour trading activity over the past 24 hours, which is close to what CoinMarketCap records (at about $27 million).
Compliant cryptocurrency derivatives exchanges accounted for just 1 percent of the sector's trading volume during Q2 2020, as reported last year, with $21.62 billion in reported volume.
According to a detailed study, crypto markets are rife with manipulation and "endless" wash trade, as covered in 2020.