Institutional Participation in Bitcoin Futures Reaches Record Highs
• CME Bitcoin Futures Open Interest has surged to near-record highs at 21%, indicating growing institutional participation in BTC futures.
• Institutional participation in BTC futures has been increasing since the start of the year amid a rise in crypto prices.
• Bitcoin surged to over $23,000 over the weekend, a level not seen in more than four months.
The Chicago Mercantile Exchange (CME) has seen its open interest in Bitcoin futures surge to near-all-time highs at 21%, indicating increasing institutional participation in the digital asset. This comes at a time when Bitcoin is rallying, having recently risen to a level not seen in more than four months.
According to a recent report by Arcane Research, institutional participation in BTC futures has been increasing since the start of the year amid a rise in crypto prices. This is evidenced by the fact that Bitcoin futures contracts have started trading at a premium to the spot market, the first time this has happened since the fall of FTX.
CME is one of the largest derivatives exchanges in the world that offers futures and options trading services in many different industry segments. This includes stock market index, currency, real estate, commodities, and cryptocurrencies. Generally, a rise in crypto-related trading volumes on the platform suggests an influx of institutional investors into the digital asset space.
Arcane stated that the strong start to the year has been backed by growing institutional participation in BTC futures. CME’s share of the total open interest in BTC futures currently sits at 21%. This is higher than the level seen in October and December 2021.
The rise in open interest in BTC futures on the CME exchange comes as cryptocurrencies have started the year with a strong rally. Bitcoin surged to over $23,000 over the weekend, a level not seen in more than four months. The flagship cryptocurrency is up by more than 35% YTD. Furthermore, Genesis disclosed that Gemini had sold 30.9 million GBTC shares during its bankruptcy filing, leading investors to purchase the heavily discounted GBTC and hedge through CME futures.
The increased institutional participation in BTC futures is a positive sign for the digital asset space. It shows that more institutional investors are becoming comfortable with the asset class and are willing to invest in it. It remains to be seen if this trend will continue, as the crypto space is still in its infancy and is subject to extreme volatility.