Bitfinex: The decline in CME Bitcoin open interest indicates that Bitcoin prices will further drop

ChainCatcher news, according to CryptoPotato, the latest weekly report from the cryptocurrency trading platform Bitfinex shows that last week, the U.S. Bitcoin spot ETF lost over $100 million per trading day, with a total outflow amounting to $544.1 million.

Analysts from the trading platform stated that the outflow of funds is a combined result of weak ETF investors reacting to short-term negative news and the negative financing rates leading to basis/arbitrage liquidation. One sign of the unwinding of basis/funding arbitrage is the significant decrease in open interest for Bitcoin futures on the Chicago Mercantile Exchange (CME) and other trading platforms. The reduction in open interest aligns with the negative financing rates at several exchanges over the past week, which also corresponds with the net outflows from the ETF, indicating a substantial decrease in financing arbitrage trades related to ETF fund flows.

In light of this, it must be recognized that not all ETF fund outflows should be interpreted as direct spot sales. Market sentiment remains bearish.