Investment firm Wilshire Phoenix released a report that suggests that the Bitcoin futures that are traded on the Chicago Mercantile Exchange (CME) have a greater impact on Bitcoin's price than the spot market. These contracts are cash-settled, which means that there is no actual buying or selling of Bitcoin when the futures are traded or settled.

According to the report,

“The findings of Wilshire Phoenix indicate that CME Bitcoin Futures contribute more to price discovery than its related spot markets...A leading futures market suggests the existence of a robust base of traders who may trade on such markets for many reasons such as trust in the exchange venue and lower latency.”

Why it matters: It is very strange that a cash-settled futures market would have an outsized effect on the spot market of a digital currency. Stranger still is the fact that the former chair of the CFTC claimed that the CME contract was introduced to 'pop' the Bitcoin bubble of 2017. While calling the prices that Bitcoin hit in 2017 a bubble isn't accurate, the idea that the US government is actively working to suppress the price of digital assets is totally credible. Given the power that the global acceptance of the US dollar creates for the US government, it is easy to see why it would fight other assets that challenge the dominance of the US dollar.