As Bitcoin's landscape evolves, its price is not only molded by macro factors but also by the burgeoning Bitcoin derivatives market. Futures and options contracts have become crucial indicators of Bitcoin's future movements, revealing the sentiments of a sophisticated market segment. However, these alone don't paint the full picture. The Bitcoin futures annualized three-month rolling basis provides a crucial perspective on market sentiment. This measure reveals the disparity between Bitcoin's current price and the price of a futures contract due in three months. Recently, we've seen a shift in this indicator, suggesting a bullish market sentiment... But what does the decrease in the rolling basis coupled with the drop in Bitcoin's price really imply?
The Bitcoin futures contango The Bitcoin futures contango
The difference between the Bitcoin's spot price and the price of futures contracts that expire in 3 months is a valuable, but often overlooked indicator of market sentiment.
2 min read
Updated: Jul. 20, 2023 at 3:07 pm UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
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Bitcoin, a decentralized currency that defies the sway of central banks or administrators, transacts electronically, circumventing intermediaries via a peer-to-peer network.
