The price of Bitcoin has dropped nearly 460 U.S. dollars to around 9,500 dollars since the beginning of August.
WASHINGTON, Aug. 31 (Xinhua) -- Latest data of Bitcoin futures show that speculative activities weakened after the price of the iconic cryptocurrency dropped significantly in August, according to a report from U.S. Commodity Futures Trading Commission (CFTC) on Friday.
For the week ending Aug. 27, non-commercial investors, commonly treated as market speculators, held a net short position of 1,185 Bitcoin future contracts. Meanwhile, the total amount of the future contracts held by speculators also dropped.
Besides, commercial traders, commonly treated as hedgers, also held a net short position of 26 contracts.
The price of the cryptocurrency had dropped nearly 460 U.S. dollars to around 9,500 dollars since the beginning of August, according to trading website "Coinbase".
Speculators and hedgers are different types of investors. Speculators try to make a profit from assets' price volatility, whereas hedgers attempt to reduce or "hedge" the amount of risk created by price volatility during the holding period of the assets.
When investors "short" some kind of financial assets like currencies, commodities, options or futures, they hold a bearish view on the assets and believe there will be a drop in their price.
The Bitcoin futures, traded at Chicago Mercantile Exchange in the United States, are derivative financial contracts that obligate the parties to transact an underlying asset at a predetermined future date and price. The underlying asset of each Bitcoin future contract includes five Bitcoins.
