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Could Binance be on the verge of taking back its lead from CME in futures markets?

Quick Take

The futures open interest market has witnessed a seismic shift, with CME rising to prominence, outpacing Binance to hit a 30% dominance. This ascension was propelled by the lead-up to the spot Bitcoin ETF, which saw a high of 136,000 Bitcoin allocated in CME on Jan. 10, which decreased to 112,000 Bitcoin by Jan. 22.

A significant one-day drop in CME open interest was observed on Jan. 12, with a decrease of around 13,000 Bitcoin, which coincided with Bitcoin’s largest one-day drop since the FTX collapse. Meanwhile, Binance has approximately 100,000 Bitcoins in open interest.

CME Futures Open Interest Daily Change: (Source: Glassnode)
CME Futures Open Interest Daily Change: (Source: Glassnode)

However, analyst Vetle Lunde of K33 research suggests a potential further reduction in CME Open Interest (OI), with 20,000 Bitcoin positioned above the average.

According to Lunde, this reduction correlates with a decline in CME OI held by non-ETFs, which has dropped by 21,540 Bitcoin since Jan. 8. Meanwhile, ETPs globally have seen net inflows of 15,968 Bitcoin in the same period, which, according to Lunde, indicates a rotation into spot ETFs from CME.

These dynamics pose an intriguing question: could this signal an opportunity for Binance’s open interest to regain its top position?

CME Open Interest by non-ETFs: (Source: K33 Research, Vetle Lunde)
CME Open Interest by non-ETFs: (Source: K33 Research, Vetle Lunde)

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