Activity in CME Group's regulated Bitcoin futures market has collapsed to its weakest level in over a year, with average daily open interest falling to about $7.2 billion in early April 2026—the lowest since February 2024. This marks a five-month decline, with March volume plunging to $163 billion, nearly half the peak seen in January 2025.
The primary driver is the unwinding of the once-dominant cash-and-carry basis trade, a strategy where institutions bought spot Bitcoin ETFs while shorting CME futures to capture the spread. "The era of arbitrage is over; Wall Street withdraws from Bitcoin basis," a Binance research note declared in January. The strategy's appeal has evaporated as Bitcoin retreated from highs near $120,000 to below $70,000, compressing the annualized basis to around 5%, barely above the ~4.5% U.S. risk-free rate. When accounting for funding costs and counterparty risk, the trade became unprofitable.
In contrast, total open interest for Bitcoin and Ethereum futures across all venues has surged sharply in the last 24 hours, signaling a potential shift in market sentiment. According to CryptoQuant, perpetual futures open interest rose by $2.1 billion for Bitcoin (BTC) and $2.2 billion for Ethereum (ETH), hitting their highest dollar-denominated levels in weeks. CoinGlass data confirms Bitcoin open interest is at a two-month high.
CryptoQuant analysts attribute this surge to "macro-event-driven positioning," with traders front-running an anticipated improvement in risk sentiment following a conditional U.S.-Iran ceasefire agreement. Crucially, coin-denominated open interest also rose, indicating traders are opening net new long positions, not just short liquidations. About $182 million in shorts were liquidated in the last day.
The price impact is clear: Bitcoin and Ethereum are up more than 7% over the past week, trading at $72,103 and $2,216 respectively. The Coinbase Premium Index has turned positive for both assets, suggesting renewed demand from U.S. investors. "If the ceasefire holds... the Coinbase Premium could sustain positive territory, reinforcing the bullish price trajectory," CryptoQuant noted.
For Bitcoin, the flattening CME basis implies less leveraged carry trading, potentially leading to healthier, more spot-driven price action. The broader market now faces a dichotomy: regulated CME futures are losing share to offshore perpetual swaps, even as overall institutional risk appetite appears to be re-engaging.
