Open interest in Bitcoin (BTC) futures on the global derivatives giant Chicago Mercantile Exchange (CME) has reached $5.2 billion, $200 million less than the all-time high reached in late October 2021.
Open interest in CME’s Bitcoin futures increased from $3.63 billion to $5.2 billion over the past 30 days, according to Coinglass data. The surge in open interest paralleled Bitcoin’s 26% rise over the same period, with Bitcoin currently trading at just over $44,000.
From October 1 to 21, 2021, CME’s Bitcoin futures open interest jumped from $1.46 billion to $5.45 billion.
The sharp rise in open interest coincided with a surge in the price of Bitcoin from $45,000 to $66,000.
IG Australia analyst Tony Sycamore told Cointelegraph that the increase in open interest shows renewed interest in Bitcoin. However, it does not explain how CME traders are positioned.
Sycamore pointed to a report CME filed with the Commodities Futures Trading Commission on Nov. 28, which showed that the platform’s “large players” at the time had net long positions, with 20,724 short positions; Buy positions reached 18,979, Sycamore explained.
Until CME’s latest report comes out on Tuesday, December 12, Sycamore said investors won’t know exactly where CME’s players are.
“What we don’t see right now is whether the big players have transitioned from short to the net to long to the net,” Sycamore said. “If you see the market going extremely long, you’d be very worried about a snapback. “The market we saw last week was short so I don’t think we’re there yet.”
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The massive rise in Bitcoin’s price is being driven by more than just speculation about the SEC’s potential approval of the spot ETF product roster, Sycamore added. A decision on the ETF is set for early January.
“I think there should be more momentum now. It’s no longer just ETFs or speculative halvings. This started to take on a life of its own.”
Sycamore said the recent Bitcoin rally could be more closely attributed to the cryptocurrency’s relationship with the macro environment, and sees signals from the Federal Reserve to start cutting interest rates as a more important driver of price action.
Last November, CME topped Binance in Bitcoin futures open interest, which many interpreted as a sign that traditional financial institutions were starting to show greater interest in cryptocurrency products.
Many analysts believe a spot ETF approval would lead to a sharp rise in the price of Bitcoin, but not everyone is convinced the current rally can last, with some calling for a “sell the news” style call in the days and weeks following the potential approval. It also predicts events.
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