It was the last Friday of the month, so fiat settled CME bitcoin futures have now expired for the month of February.
Around 20,000 bitcoin representative contracts were exchanged on Friday, worth some $170 million, with double that amount exchanged on Wednesday and Monday.
Bitcoin was generally sidewaying until the puzzling drop on the 24th of February that coincided with the beginning of a significant correction in stock markets.
CME tends to be used by Wall Street type institutions so there might have been some relationship between stocks and bitcoin as bank traders sold off everything, including gold.
They bought Chinese Yuan for some reason, while all other assets, including government bonds, fell.
That makes it a somewhat peculiar market behavior because you’d expect the money to be going somewhere, and thus some assets to rise, with it unclear where they went here because if it was dollar cash you’d expect the dollar to rise.
It hasn’t, so logically the only thing that can make sense is this is trader led primarily speculation through complex instruments like margins, derivatives, hedging strategies, and overall an artificial behavior rather than led by the real market.
It may well be that ordinary investors are not quite divesting from stocks, it might instead be just traders shorting. So it’s perhaps more a paper loss, with paper funds moving between longs and shorts, while actual value is not quite moving because if it was some assets would have behaved differently.
In the decentralized finance (Defi) space you get paid for this paper funds movement as an investor because someone that wants to go short or long for example has to borrow the asset from you at interest.
In traditional markets ordinary investors don’t even have the right to chose whether their stock can be lent to shorters. They certainly get no interest for this use of their funds, the broker or bank does. Nor is it clear whether anyone can really audit something like whether stocks have been printed out of thin air.
CFTC, which is meant to regulate derivatives like margins or futures, and SEC, which regulates stocks, both have a meager budget of around $250 million a year.
SEC especially has to effectively regulate the entire economy on a budget for ants. So they probably not even doing any studies and are probably not even looking at what is happening in the banking casinos.