The ongoing legal process between Binance and the SEC took an interesting turn on September 18. Magistrate Judge Zia Faruqui denied SEC’s request for access to Binance US systems. Instead, the judge suggested that the SEC review its examination requests in specific areas. While this decision only temporarily postpones the need for Binance US to present the difference between its data storage solution and Binance International in court, the market responded positively, especially Bitcoin.
According to Yahoo Finance, Judge Faruqui scheduled a hearing for October 12 and called on Binance and the SEC to submit a status report before the hearing. This decision, which seems to be against the SEC, can potentially increase the risks for Binance. Despite a report from Binance US contradicting this, Binance founder and CEO Changpeng Zhao remains adamant that Binance US has never used Binance International’s data storage system. Furthermore, the SEC has not yet provided a clear report on Binance’s alleged attempt to mislead the court with false evidence.
Alongside the legal process, the outlook for Bitcoin price has significantly improved for the next three weeks, and no major changes are expected until the upcoming court date. To gauge the increasing optimism among professional investors, we can examine Bitcoin’s margin and derivative data.
Futures contracts provide valuable information about professional investors’ position weights and views, as they allow investors to increase their risks through borrowing on the exchange. Recent data reveals a decline in the borrowing rate for investors preferring the OKX exchange, reaching the lowest point in the past three months, dropping from 27x to 19x just a week ago. These data indicate a decrease in the notable superiority of long positions, but the current situation still favors the bulls.
A long option/short option ratio of 0.70 indicates that open positions in long options are lagging behind rising short options, suggesting a price increase. Conversely, an indicator of 1.40 signifies a preference for short options, indicating a downward trend. The short/call ratio for Bitcoin futures trading volume has recently dropped to a balanced 1.04 from supporting short options at a level of 1.50 on September 20, indicating a decreased interest in protective long options.
In particular, since September 18, investors in Bitcoin futures have either opted for neutrality or slightly preferred short options. This indicates that professional investors were caught unprepared for the price rally above $27,000. However, data from investors suggests buying support from spot orders, indicating that larger institutions or investors known as whales are buying Bitcoin regardless of the price.
Now, BTC and other cryptocurrency investors have three more weeks until October 12, when the Federal Judge will hold another hearing and potentially release decisions that could pressure Binance US. During this period, Bitcoin prices could surpass $28,000.