Bitcoin futures' open interest on a one-day basis experienced a significant increase of over 20,000 BTC, marking the biggest jump since June. This surge in open interest coincides with the asset's break above $71,000 for the first time since June. The increase in open interest suggests new money entering the market and indicates a strengthening trend. However, research firm Kaiko noted that funding rates for BTC futures remain below March highs, indicating tempered demand. Several factors contribute to the rise in open interest, including a surge in contracts offered on the Chicago Mercantile Exchange (CME), a spike in funding rates in perpetual markets, and strong inflows from U.S. listed spot ETFs. The dominance of CME in the futures open interest market has reached 30%, and the funding rate in perpetual markets has soared to 15%, signaling a bias for bullish long trades. Furthermore, U.S. listed spot ETFs have seen $2.7 billion in net inflows, with BlackRock's iShares Bitcoin Trust (IBIT) leading the charge. The recent divergence between CME open interest and ETF inflows suggests a shift towards directional long plays rather than cash and carry arbitrage. However, opinions differ, with some suggesting that the basis trade has already picked up due to increased net short positioning and CME open interest.



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