04 Apr 2022

Futures market update: Basis premium on CME declining

We see a sharp decline in CME’s basis premium while it sits stable at the offshore exchanges.
CME saw a sharp decline in its basis on Thursday, coinciding with the EU voting to impose KYC on private wallets.The BITO ETF had a slow last week with slight outflows. This might have further contributed to reducing the basis on CME.Relatively stable basis on the offshore exchanges in the last week, with both Binance and FTX seeing its basis sit stable at around 5-6%.
Source: Skew
Funding rates remain below positive for the 122nd consecutive day on Binance and Bybit as perp traders remain cautious. Funding rates are still neutral to below neutral on Binance and Bybit.However, since BTC broke out above $45,000 last week, funding rates have normalized around neutral territory, suggesting that there is a balanced demand to long and short at the moment.The open interest in BTC perps has also declined substantially over the last weeks, falling from 256,000 BTC on March 24th to 236,000 BTC on April 4th, as market participants seem to be deleveraging.
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