Binance Dethrones CME in Bitcoin Futures as Key Institutional Trade Dries Up

Binance has unseated the Chicago Mercantile Exchange (CME) as the top venue for bitcoin futures open interest, a clear signal that a popular and lucrative trading strategy for institutional investors is rapidly losing its appeal.

According to data from CoinGlass, Binance now commands roughly <span class="economy-highlight">125,000 BTC</span> (a notional value of $11.2 billion) in open interest. This narrowly surpasses CME's <span class="economy-highlight">123,000 BTC</span> ($11 billion), which has fallen to its lowest level since February 2024.

Behind the shift is a sharp decline in the profitability of the 'basis trade.' This strategy involves traders buying spot bitcoin while simultaneously selling futures contracts at a higher price to capture the spread, or 'basis.' It has been a mainstay for institutional players seeking steady returns, but that predictable income stream is evaporating.

Velo data shows the annualized basis rate has compressed to roughly <span class="economy-highlight">5%</span>. That's a steep fall from the <span class="economy-highlight">15%</span> levels seen just over a year ago when institutional excitement peaked following President Trump's election victory. As spot and futures prices converge, the arbitrage opportunity continues to shrink.

CME had held the top spot since November 2023, largely fueled by institutional positioning ahead of the launch of U.S. spot bitcoin ETFs in January 2024. As the basis trade unwound, so did CME's dominance. In contrast, Binance's open interest, which the source notes is favored by "retail punters betting on directional price movements," has remained steady throughout the year, allowing it to claim the top position.

This leadership change is more than a simple horse race between exchanges; it highlights a maturing crypto market where easy arbitrage windows are closing. For institutional players, the hunt for yield will require more sophisticated strategies. For the broader market, it could signal a temporary shift in influence from institutional arbitrageurs back to sentiment-driven retail traders, potentially impacting short-term volatility.