Bloomberg’s Mark Cudmore said the first day of silver and gold futures trading on the London Metal Exchange (LME) could provide a fresh source of excitement and buying interest, but that doesn’t appear to be the case.

According to the Financial Times, the new futures contracts, called LMEprecious, got off to a lackluster start. Just 41,500 troy ounces of gold and 15,000 troy ounces of silver were traded on Monday (July 10). That’s much less than the daily average of 20.8 million ounces transferred in the OTCmarket in May.

Kate Eged, head of precious metals at the LME, told the news outletthat the new contracts offer the daily structure of the OTC markets combined with the monthly futures approach of international exchange options. Eged added that the contracts provide a solution to pressing challenges such as ongoing regulatory change, increased transparency requirements and the threat of market fragmentation.

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The contracts are a joint effort fromthe World Gold Council and the LME, and will compete against existing the COMEXgold and silver futures contracts run by CME Group in New York. The ICE futures exchange in Europe is another place where gold and silver futures are traded.

The launch comes just days after a flash crash that sent silver futures on the COMEXfrom $16.18 per ounce to $14.86.The crash, which saw 25 million ounces of silver change hands within a minute, has been widely labeled a glitch and blamed on a fat-fingered trader.

Prior to the event, gold and silver were trading down ahead of a US jobs report that revealed the US economy added 222,000 jobs in June, exceeding economists’ forecasts and stoking expectations that the US Federal Reserve will hike interest rates once again before the end of the year.

Just hours after the crash, top Wall Street strategist Tom Lee said he sees bitcoin cannibalizing demand for gold. Lee has established a framework for valuing popular cryptocurrency as a substitute for gold.

Based on our model, we estimate that bitcoin’s value per unit could be $20,000 to $55,000 by 2022, Lee said. Considering that both silver and gold are considered safe-haven assets in times of geopolitical uncertainty, it is possible that bitcoin could slow demand for silver as well.

Silver recovered quickly from the crash, and wastrading at $15.64 as of 11:00 a.m. PST on Monday.

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Securities Disclosure: I, Melissa Shaw, hold no direct investment interest in any company mentioned in this article.

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