JPMorgan sees limited institutional demand for perpetual futures
JPMorgan analysts report that institutional demand for perpetual futures in the crypto market remains limited, as these products are primarily used for speculative trading rather than hedging. The bank notes that structural drawbacks, such as the lack of traditional clearing protections, make them unattractive to institutional investors.
Why it matters
This highlights the ongoing gap between retail-driven crypto derivatives and the requirements of traditional institutional finance.
Based on conversations with clients and market participants, the bank said institutional interest in perpetuals has been muted. While the contracts offer 24/7 trading and eliminate futures roll costs, most activity is driven by traders seeking leveraged directional exposure rather than producers, consumers or other participants hedging underlying market risk.
The article summarizes a bank report and explains the technical limitations of a financial product objectively.
Get smarter about the news
Sign up free for a feed built around what you actually care about, Dive Deeper research on any story, and the full text of every article.
Create free accountAlready have an account? Sign in