In a sign of rising animal spirits, the seven-day average funding rate on Bitcoin futures — the cost of keeping a bullish bet open — rose to 5 per cent on the Binance platform. That compares with just 1.9 per cent at the end of September in Bybt data compiled by The Block, a crypto information service.
The value of outstanding futures on crypto exchanges rebounded to $21.5 billion, compared with the $27 billion peak earlier this year, according to Bybt.
Similarly, the curve has steepened in CME futures, indicating an increasingly optimistic outlook for Bitcoin’s trajectory. The gap between December contracts and this month’s widened to 990 basis points, the most since April.
Ki Young Ju, chief executive officer at analytics firm CryptoQuant, said on Twitter prices have been driven by whales buying large amounts of the cryptocurrency through derivatives.
It all marks a shift from recent months, when Bitcoin bulls were left subdued after the May crash and attention turned to a host of other speculative manias like non-fungible tokens.
“With a well integrated ETF structure, crypto is poised to go mainstream,” said Peter Rosenstreich, head of market strategy at Swissquote Bank.
Bloomberg
