Chicago Mercantile Exchange (CME)’s Solana Futures (SOL) was released on March 17th and had a trading volume of $12.1 million on the first day.
Comparison of CME Crypto futures by Vetle Lunde. Source: X.com
Vetle Lunde, head of research at K33Research, compared differences in Bitcoin (BTC), Ether (ETH) and Solana (SOL) CME futures trading performance on launch dates.
However, Lunde pointed out that Sol’s launch is “close to two” when the normalized amount of market capitalization is evaluated.
Did Sol CME Futures launch DUD?
Throughout the current bull market, the approval of the Spot ETF and launch of CME futures contracts consistently boosted investors’ sentiment and brought winds behind the sails of various cryptocurrencies. A more unbiased comparative analysis is obtained by comparing normalized volumes adjusted for differences in market capitalizations for BTC, ETH and SOL on the first CME futures trading day.
Compared to the market capitalization of cryptocurrencies, normalized volume measurement trading activities provide a transparent valuation in different cryptocurrencies. This metric is valuable because it allows you to understand the institutional involvement regarding the market capitalization of crypto assets.
Normalized volume comparison. Source: Cointelegraph
As mentioned above, Bitcoin had the highest normalized volume at 0.0319%, while ETH and SOL were lagged at 0.0173% and 0.0166%, respectively. The larger the normalized amount, the higher the interest of investors per unit or market capitalization of Bitcoin.
Furthermore, the similarity of the normalized volumes of ETH and SOL (approximately 0.017%) indicates that Solana’s trading activity scale is similar to that of Ether, despite a difference in volumes of over $20 million on day one between ETH and SOL CME futures.
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Do Sol CME futures follow ETH or BTC performance?
After Bitcoin CME futures debuted on December 18, 2017, BTC fell 26%, falling from $19,000 to $14,000 by December 31, 2017. The revision continued until 2018, marking the start of a collective crypto-bear market.
Releases and price reactions of Bitcoin, Ethereum and Solana CME. Source: CointeLegraph/TradingView
Ether Prices registered a 150% meeting for $4,384 93 days after it began on February 8, 2021. A sharp revision occurred following the new all-time high, but the altcoin was once again repeated towards the end of 2021.
Given the price trends of Bitcoin and ETH, Sol’s prices could be experienced a less enthusiastic rally. The lack of rising prices after the launch of CME futures suggests a lack of investors’ excitement.
However, from a long-term perspective, the presence of Sol in CME increases Solana’s liquidity and price discovery opportunities, as it attracts institutional involvement. As better market conditions and preferred bullish prices and protocol revenue forecasts extract traders’ profits, broader impacts could potentially unfold over time.
Related: Bitcoin Under $85,000 – Important BTC Price Levels to Watch Before FOMC
This article does not include investment advice or recommendations. All investment and trading movements include risk and readers must do their own research when making decisions.
