Bitcoin futures open interest on the CME exchange has reached a record high of 172,430 BTC, which is equivalent to $11.6 billion. This surge in open interest is a significant indicator of a bullish trend in the market. Over the past five trading days, CME bitcoin futures have experienced a notable increase of 25,125 BTC, marking one of the highest changes recorded in recent years.
This milestone in open interest was highlighted by Vetle Lunde, a senior analyst at K33 Research, who pointed out that the growth in open interest on the CME is being primarily driven by active and direct market participants, rather than inflows from futures-based ETFs like ProShares Bitcoin ETF (BITO). The chart provided by Lunde shows a breakdown of open interest by cohort on the CME, with active and direct participants holding a significant amount of BTC, similar to levels seen in March when bitcoin reached its all-time high.
Interestingly, the 1x leveraged ETF has seen a decline throughout the year and currently holds only 31,752 BTC. On the other hand, the 2x leveraged ETF, which experienced a surge in March, has only seen slight growth since then. This suggests that speculation and leverage were major drivers in the early part of the year, but are no longer the primary factors influencing the current market.
The activity in the market is structured around the November expiry, following the U.S. election. This indicates that market participants are closely monitoring political events and their potential impact on the market. The rise in open interest on the CME exchange reflects a growing confidence in bitcoin and a positive outlook for the future of the cryptocurrency.
Overall, the surge in bitcoin futures open interest on the CME exchange is a significant development that points towards a bullish trend in the market. Active and direct market participants are driving this growth, indicating a strong belief in the potential of bitcoin as a valuable asset. The breakdown of open interest by cohort provides valuable insights into the dynamics of the market and the factors influencing investor behavior. With this record high in open interest, it will be interesting to see how the market continues to evolve in the coming days and weeks.