Bitcoin futures debuted in the U.S. in December and some traders are using data from that marketplace to forecast moves in the largest cryptocurrency.

Bitcoin futures debuted on the Chicago Board Options Exchange (CBOE) in December with CME Group following suit just a few days later. The derivatives linked to the largest digital currency by market value are seeing a steady rise in activity.

“The non-commercial futures contracts of bitcoin, traded by large speculators and hedge funds, totaled a net position of -1266 contracts in the week ended Aug. 21 – the lowest on record, according to the data released by the Commodity Futures Trading Commission (CFTC) on Friday,” reports CoinDesk.

Nasdaq Inc. is still considering entering the bitcoin futures competition. Market observers previously expected Nasdaq to launch futures on the digital currency this year. The exchange operator has previously said that if it moves forward with bitcoin futures, its product will be different from those offered by Cboe and CME.

Derivatives help increase liquidity and improve markets for an asset category by allowing investors to bet on ups and downs of an asset, evening allowing individuals to adopt market-neutral strategies. They are also a key component in the creation of many futures-backed ETFs utilized by a range of investors

Current Bitcoin Outlook

“The sharp drop in the bearish sentiment, as represented by the steady decline in the net short positions from the high of -1945 seen ten weeks ago to -1266, adds credence to the signs of bearish exhaustion indicated by BTC’s defense of $6,000 since mid-June,” according to CoinDesk.

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