Open interest in bitcoin futures listed on the Chicago Mercantile Exchange (CME) has recovered significantly from the March lows, indicating a resurgence in institutions that want to buy the cryptocurrency.
As of Wednesday, open interest, or the number of futures contracts outstanding, was $181 million, a 70 percent increase from $106 million recorded on March 22.
The number stood at $196 million nine days ago. That was the highest since March 7, according to data provided by the crypto derivatives research firm Skew.
“The growth in open interest from CME may indicate that entities from traditional finance are more open to add bitcoin exposure to their portfolios, whilst retail investors are seemingly more reluctant to indulge in the futures market,” cryptocurrency platform Luno noted in its latest weekly market report.
Bitcoin futures listed on the CME are widely considered to be synonymous with the institutional activity and macro traders. The CME is the largest futures exchange in the world, providing institutions access to derivatives on equities, commodities, foreign exchange pairs and bonds, and was one of the first exchanges to launch bitcoin futures in December 2017.
Open interest had dropped sharply from $316 million to $107 million during the three weeks to March 12, as institutions treated bitcoin as a source of liquidity during the coronavirus-led “Black Thursday” crash in the global equity markets. Investors generally prefer to hold cash, mainly U.S. dollars, during a crisis situation.
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