For a second month in a row, the bitcoin market lacks a clear directional bias, with prices largely restricted to a narrow range of $9,000 to $10,000. However, the cryptocurrency’s liquidity on derivative exchanges continues to heat up, a sign of a sustained rise in investor interest.
On a relatively new exchange like the Antigua-based FTX, the order book depth, as represented by the number of buy and sell orders at each price, now matches the depth seen on industry leader BitMEX.
One derivative seeing growth is perpetuals, a form of futures contract, but without an expiry date and thus without a settlement. Perpetuals have a funding rate that occurs every eight hours and traders holding a position at the funding timestamp receive or pay funding.
As of Monday 13:10 UTC (9:10 a.m. ET), the daily average bid/offer spread for bitcoin perpetual swaps for $10 million quote size on FTX is 0.32% compared to 0.28% on BitMEX, according to data provided by the crypto derivatives research firm . BitMEX was founded in 2014 and is bitcoin perpetuals exchanges by trading volumes while FTX launched in May 2018.
The bid–offer spread is the difference between the prices quoted for an immediate sale and an immediate purchase for an asset. The larger the gap, the greater the spread. A small spread implies a highly liquid market and vice versa.