CFTC Initiates Enforcement Sweep Targeting Opyn and Other DeFi Operations
Binance Supercharges Bitcoin and Ether Trading in Argentine, Brazilian, and South African Currencies with Exciting Fee Promotion
SEC Postpones Spot Bitcoin ETF Decision for All Applicants, Including BlackRock and Fidelity
Bitcoin (BTC) futures markets are witnessing a surge in capital inflows, surpassing levels seen in the past year, as traders place their bets on price fluctuations amidst a flurry of cryptocurrency exchange-traded fund (ETF) applications.
Over the weekend, open interest on bitcoin futures reached an impressive milestone, surpassing $11 billion and hitting its highest level since May of the previous year, which coincided with the collapse of the once-dominant Terra. The surge in open interest reflects a significant number of unsettled contracts in the market.
Open interest was previously at these levels in May last year. (Coinalyze)
A rise in open interest signifies the influx of fresh capital into the market or an increase in the allocation of existing participants. This metric serves as an indicator to gauge market sentiment and ascertain the driving force behind price trends.
Coinalyze data reveals that open interest has predominantly maintained a steady level of around $8 billion since late April.
The surge in bitcoin futures trading coincides with an increase in trading volumes and buying activity in the bitcoin options markets, primarily utilized by experienced investors to mitigate risks associated with price fluctuations or capitalize on leveraged positions based on bitcoin price movements.
The trend is expected to persist, as per some market observers, if applications for exchange-traded funds (ETFs) from renowned financial institutions like BlackRock are approved in the coming months.
“Bitcoin’s rally is part of a larger trend signaling a shift towards bitcoin as a distinctly strong and established store of value,” shared Alex Adelman, CEO of bitcoin rewards app Lolli, in an email last week.
“The recent burst of bitcoin ETF applications from leading institutions like BlackRock, Fidelity, and Invesco shows that new regulatory guidelines are the greenlight institutions have been waiting for to launch bitcoin-based products and meet client demand,” Adelman added.
