The notional value backing Bitcoin futures has dropped to 0.24x relative to the spot market, its lowest level in two years. Aggregate Bitcoin futures open interest has declined 47% to 55% from peak levels, with total notional exposure fluctuating between $40B and $70B. Annualized basis yields have compressed from over 20% to just 3-5%, making arbitrage strategies far less attractive. Offshore Bitcoin futures activity has collapsed by 97% from its 2021 bull market highs. This retreat of speculative leverage leaves spot prices more vulnerable to idiosyncratic flows such as large wallet movements or exchange-specific liquidity events.
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