According to CoinDesk, the year 2024 has seen a remarkable advancement for digital assets, particularly bitcoin (BTC), fueled by increased institutional adoption. This transformation has been facilitated through two primary channels: the incorporation of bitcoin into public balance sheets as a treasury asset and the success of U.S. spot-listed exchange-traded funds (ETFs), which have accumulated over 1 million BTC.
A report from K33 Research highlights that U.S.-listed bitcoin ETFs have overtaken U.S.-listed Gold ETFs in terms of assets under management (AUM), including leveraged products like futures-based ETFs. As of December 17, Bitcoin ETFs reached an AUM of $129.25 billion, surpassing Gold ETF AUM at $128.88 billion, as noted by Vetle Lunde, an analyst at K33 Research. However, when focusing solely on spot-based products, Gold maintains a slight lead. Senior Bloomberg ETF Analyst Eric Balchunas reports that U.S. bitcoin spot ETFs hold $120 billion in AUM compared to $125 billion for Gold ETFs.
The CME exchange, predominantly utilized by institutions, continues to exhibit robust activity, with futures open interest nearing new highs, reaching 212,635 BTC in open interest contracts. The report indicates that the basis trade premium has been on the rise, hitting 16.4% — the highest level since November 2023. This suggests that CME traders are anticipating increased momentum as the year concludes. The report further notes that "January contracts are trading at sharp premiums relative to December contracts, with the contango widening to 1.5% on Monday — the highest next-month premium recorded since November 2023. The December contract on CME remains the most valuable, with open interest equivalent to 113,480 BTC. The upcoming December roll is expected to be significant, as several upcoming banking holidays may contribute to a further widening of the January premium."
The momentum has persisted over the past month, with U.S. spot-listed bitcoin ETFs experiencing net inflows every day since November 27, amounting to $6.5 billion, according to Farside data. It is crucial to note that as the basis trade premium continues to expand and with a growing number of open interest contracts on the CME, a substantial portion of these net inflows are part of the cash and carry trade.
