As of October 18, the open interest (OI) in Bitcoin futures traded on the Chicago Mercantile Exchange (CME) reached a new record of $12.26 billion. This represents a sharp increase of over 36% in just two weeks, surpassing the previous record set in April 2023. The rise in OI suggests that more institutional players, such as hedge funds and asset managers, are actively taking positions in Bitcoin futures, likely in anticipation of ongoing price volatility or upward momentum.

CME, one of the largest regulated derivatives exchanges, is preferred by institutional investors due to its regulatory clarity and structured environment. This record-breaking activity underscores the growing institutional adoption of Bitcoin, further solidifying its position as a significant asset in financial markets. The increase in OI indicates that many professional investors are positioning themselves ahead of potential market movements, signaling a shift towards greater participation from the traditional finance sector into the crypto space.

You Might Be Interested: Institutional Interest in Bitcoin Grows

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Bloomberg ETF analyst James Seyffart said, “Despite the ‘unrelenting’ outflows from Grayscale, the outlook for spot Bitcoin ETFs remains positive. In total, there are over $1.1 billion in net inflows. According to data analysis, $76 million in asset outflows occurred.”

Update: BlackRock's numbers are in for the #Bitcoin ETF Cointucky derby. Third biggest inflow day for $IBIT yet at $272 million. Only -$76 million in net outflows for the day. https://t.co/ySE0edbz4c pic.twitter.com/RzgH6qn5Md

— James Seyffart (@JSeyff) January 23, 2024

In a post on his Twitter account on January 23, James Seyffart wrote, “Overall, it was a ‘bad day’ for Bitcoin ETFs at the Cointucky Derby. Today $640 million flowed out. Outflows are not slowing down; they are accelerating. This is the largest outflow ever for GBTC. Total outflows so far are $3.45 billion.”

In an interview with Cointelegraph, Seyffart said,

“In general, flows into Bitcoin ETFs are moving in a positive direction, with BlackRock experiencing its third-largest positive flow day ever and seeing a total of $272 million in inflows per day. On a net basis, even after accounting for GBTC outflows, we have seen over $1.1 billion in inflows into spot Bitcoin ETFs. While I acknowledge that outflows from GBTC appear ‘unrelenting,’ I expect the GBTC-led decline to subside over the next two weeks.”

Converted GBTCs (Bitcoin ETF)

Grayscale, which converted its GBTCs, believes that most of the outflows from this fund are related to large sales from the FTX estate.

Since $GBTC conversion to #BitcoinETF investors have sold > $2 Billion

FTX bankruptcy liquidation has led to > $1 Billion in selling $BTC

GBTC discount to NAV arbitrage trade led to > $1 Billion selling to lock in profits.

All of that selling in a relatively short time and… pic.twitter.com/e0I0ms3y3D

— CJK (@CJKonstantinos) January 22, 2024

According to a report prepared on January 22, the FTX estate had sold about two-thirds of its 22.8 million GBTC shares as of January 22. It is estimated that the sale of the shares accounted for about $600 million of the total sales.

How Is This Situation Affecting Bitcoin?

Since the approval of the Bitcoin ETF, Bitcoin has reached 49,100 dollars at the time of approval, but then a decline began.

In particular, this downward movement for Bitcoin occurred in the midst of a sudden and sharp decline in open positions for Bitcoin futures on the Chicago Mercantile Exchange (CME). This shows that institutional investors are less eager to gain leveraged exposure to Bitcoin.

According to data from CoinGlass, open positions to CME fell to $4.4 billion from almost a record $6.4 billion when it was published on January 12.

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