CME Bitcoin futures hit lowest activity since February as basis trades unwind

CME Bitcoin futures activity and open interest have dropped to their lowest point since February 2024 as basis trades unwind. On Polymarket, odds for Bitcoin hitting $100,000 by year-end are at 34.5% YES, down from 36% yesterday.

Market reaction

The Bitcoin $100,000 market trades $2,613 in actual USDC daily, making it the more active of the two price target contracts. The $150,000 market sits at 9.5% YES. A YES share for the $100,000 target costs 34.5¢, with a 2.9x payout if it resolves YES.

Why it matters

The basis trade unwind means institutional players are closing positions where they bought spot Bitcoin (often through ETFs) and shorted CME futures to capture the spread. As basis yields fall below risk-free rates, this trade stops being profitable, and positions get closed. The result is lower open interest and less institutional capital committed to Bitcoin markets. With Bitcoin down over 20% year-to-date, traders are reluctant to take new bullish positions.

What to watch

BlackRock’s activity with the IBIT ETF and MicroStrategy’s Bitcoin acquisitions are the two most likely catalysts for renewed buying pressure. Fed announcements matter too: any signal of easing monetary policy would narrow the gap between basis yields and risk-free rates, potentially making the basis trade attractive again and drawing institutional capital back in. Regulatory developments could also shift sentiment in either direction.

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