This is how much Bitcoin institutions trade on CME.

While Binance remains the world's largest venue for Bitcoin futures trading, another more regulated market is now following close behind.

CME Bitcoin Futures now stands as the second largest Bitcoin futures exchange in the world by open demand, reflecting increasing demand from institutions seeking Bitcoin exposure.

Return of CME to Bitcoin

According to data from Coinglass, there are currently more than 103,000 BTC futures open interest (OI) on CME, worth $3.54 billion. This is more than 20% of the total Bitcoin futures OIA tracked by the site, which is valued at $15.59 billion.

Binance, the single largest competitor with CME, carries the same 112.63K BTC ($3.87 billion) in OIA futures, while BayBit ​​hosts the third largest market with 74.31K BTC ($2.55 billion) in OIA futures.

Open interest tells us how many Bitcoin futures contracts are outstanding in the market. Futures contracts are cash-settled agreements to buy or sell BTC from another party at a specified price, on a specified date, and act as a bet on the future price of Bitcoin, but do not necessarily involve trading in actual BTC trading.

Futures trading is usually done in perpetual futures contracts, which are contracts that cannot be terminated until the trader voluntarily closes the position, or the trader's balance is negatively terminated due to regular payments on the wrong position.

A few weeks ago, CME was the fourth-largest exchange for OIA futures, but in October, the price of Bitcoin climbed above $35,000.

The incident led to a massive short liquidation that wiped out 35,000 BTC of Everlasting Futures OI market on October 23rd. CME perp futures, however, gained 4,380 BTC during the event.

According to data from K33 Research, CME also dominates standard expiration contracts, boasting an 80% market share.

CME includes standard size contracts worth 5 BTC and micro contracts worth 0.1 BTC.

TradFi is back

Many analysts see CME's resurgence as an indication of institutional interest returning to BTC in Bitcoin futures.

On October 25, Will Clemente, co-founder of Reflexivity Research, responded to the uptick, “Tradfi is the back business of Bitcoin.” Days later, Bloomberg ETF analyst Eric Balkunas noted that Bitto — the largest Bitcoin futures ETF in the United States — took in $1.7 billion last week, while Grayscale Bitcoin Trust (GBTC) took in $800 million.

“That's $2.5b (top 1% among EFAs) with two unsolicited strategies (spots) = unlikely to set record on DAY ONE, clearly there's an audience,” the analyst wrote.