A recent analysis of open interest (OI) data on the Chicago Mercantile Exchange (CME) suggests that institutional investors, such as asset managers and hedge funds, are becoming more cautious in their exposure to Bitcoin (BTC) and Ethereum (ETH) futures.
Two weeks ago, the OI of longs on CME BTC futures by asset managers reached its lowest point since early March, dropping to $4.97 billion. This marked a significant decline from the all-time high of $6.74 billion observed in the first week of July. While there has been a slight rebound, with OI increasing to $5.64 billion last week, the overall trend indicates a potential reduction in long positions.
This decline could be attributed to several factors, including recent market volatility, macroeconomic uncertainty, or risk management strategies adopted by institutional investors. Despite the decrease, the current OI remains significantly higher than last year, highlighting the sustained growth in institutional interest in BTC.
Meanwhile, hedge funds have also been trimming their long positions on CME ETH futures. The OI of longs by hedge funds reached a yearly low of $136.26 million, the lowest level since mid-October 2023. This suggests a potentially cautious stance or increased desire to hedge positions among hedge funds.
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However, it’s worth noting that institutional interest in ETH remains relatively strong, as evidenced by the OI of longs on CME ETH futures by asset managers. This figure stood at $419.63 million last week, nearly double the $214 million recorded at the beginning of the year.
The overall trend suggests that while institutional investors are becoming more cautious in their exposure to cryptocurrencies, the underlying interest in both Bitcoin and Ethereum remains significant. As the market continues to evolve, it will be interesting to observe how these trends unfold and impact the broader cryptocurrency landscape.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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