CME Bitcoin Futures Open Interest Continues Decline, But BlackRock’s Bitcoin ETF Sees Major Inflows
CME Bitcoin Futures open interest has fallen for the fourth consecutive day, according to the latest figures from CME, suggesting a gradual decrease in market leverage and futures-based activity.
In a notable contrast, BlackRock’s iShares Bitcoin (BTC) Trust ETF (IBIT) saw a major surge in inflows, receiving $970.9 million, marking its second-largest net inflow since its launch in January 2024, based on Farside data. Of this, $591.2 million was injected on Monday alone. The rise in IBIT’s inflows came amid heavy outflows from competing Bitcoin ETFs: Fidelity’s FBTC saw $86.9 million in losses, Bitwise’s BITB dropped $21.1 million, and ARK’s ARKB lost $226.3 million in assets.
Bitcoin’s value has surged 7.2% over the past week, now trading at $94,900, helping boost demand for Bitcoin ETFs. Since April 22, IBIT has racked up $4.5 billion in net inflows, diverging from the broader market’s downward trend.
Market watchers have noted this shift. Nate Geraci, President of The ETF Store, commented on X:
“Almost $1 billion into iShares Bitcoin ETF today, marking its second-largest inflow since January 2024. It’s hard to believe we once heard there was ‘no demand.’”
Eric Balchunas, Senior ETF Analyst at Bloomberg, noted:
“ETFs are in ‘two-steps-forward’ mode, following exactly the pattern we predicted after taking one step back.”
On the derivatives front, CME Bitcoin Futures open interest has dipped to 132,750 BTC, marking four consecutive days of declines. However, this trend could reverse as basis yields have increased from 5% to 9% in April, according to Velo data, potentially leading to renewed interest in futures trades and a short-term rebound in open interest.
Why it matters:
A basis trade involves purchasing spot Bitcoin while shorting Bitcoin futures, profiting from the price gap between the two. When basis yields are high, the demand for futures tends to rise, resulting in higher open interest. Conversely, when yields decline, fewer traders engage in the strategy, leading to reduced open interest and signaling a drop in market leverage.
