Binance Futures Director Puts Derivatives’ Rise Down to the 2018 Bear Market

The popular cryptocurrency trading platform, Binance, has been quickly expanding its operations in recent months. Specifically, this is in relation to its futures market. When it announced the launch of its 20th perpetual contract with BAT/USDT, things seem to be taking off at Binance.

The derivatives hosting the Futures and Options contracts sector have seen an increase in activity over the last few months. For those that don’t know, this is a sector that enables traders to both long and short different digital assets such as bitcoin. Derivatives are often looked at as quite complex products of the financial markets. BitMEX has been a derivatives player since 2014 and things are now going quite smoothly but it took the platform around five years for the industry to properly see derivative products and actually gain interest. 

Going off the recent uptrend in the futures markets, the futures director at Binance, Aaron Gong, recently took part in an interview where he asserted that the rise of such platforms in 2019 was because of the year-long bear market in 2018. 

He further went on to add:

“And because futures contract is one of the most efficient tools to capture investment opportunities in either bearish or bullish markets, it was driven by demands of the community to either hedge positions or better manage their risk.”

When looking at other platforms such as eToro, things can get a bit cloudy as you try to calculate the real value of any kind of derivative contract. This is because there are numerous factors that influence the actual price of the underlying crypto assets. When looking to unregulated platforms, the risk profile of cryptocurrency derivatives is even higher.

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