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Expert Opinion: Bitcoin Future Moves in Backwardation, No More Constantinople for Now


“This analysis is an adaptation from the work of Mati Greenspan, Senior Market Analyst at eToro”

Key Highlights:

  • Bitcoin Futures moving in backwardation
  • Bitcoin Outlook based on Futures looks meek but still safe
  • Ethereum’s Constantinople upgrade gets delayed once again.

Bitcoin futures move in backwardation but its still safe

One of the joys of having a futures market is the ability to understand what investors are thinking about the future of the price and CBOE Bitcoin futures have been doing that for the crypto investors. But the recent data from CBOE, is not a pleasing sight as according to it we may not be at the bottom yet and there is further downside expected. Below is the chart that shows the contracts for the bitcoin futures on the CBOE are currently in backwardation, meaning that contracts with a later expiration are trading consecutively lower.

While this sight could create nervousness on a normal day but recently, we had some incidences in other markets which prove that these signs from future markets are not always correct. In October, oil futures were trading in contango (opposite of backwardation), but there was a steep drop of over 30% in prices for oil in spot markets.

Ethereum still awaits its Constantinople moment

While all eyes were fixated at block #7080000 on Ethereum’s blockchain yesterday night, which was to bring in the much-awaited Constantinople upgrade, the core dev team announced a that the upgrade is postponed. In a statement, the Ethereum Core Developers and Ethereum Security Community said that they decided to postpone the hard fork after security researchers identified a potential vulnerability in one of the software upgrades. This led to the plunging of Ethereum price’s dropping moments after the announcement was made.

While there has been a bit of a recovery in prices this morning the event was really scary. While it was good that they caught the bug before going live but the fact that it came within 30 hours of the upgrade is a bit nerve-wracking. These things do happen, virtually all major platforms including Windows, Android, and Apple Operating systems, have seen critical bugs before. Though it would be possible to release a patch, fork the network again, and return to normal, that kind of process could in itself have done irreparable damage.

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