Rising Bitcoin ETF Inflows and a Basis Trade Close to 9% Point to Growing Market Demand

Bitcoin ETF Inflows Surge Past $660M as Basis Trade Yield Nears 9%, Sparking Institutional Interest

On May 19, U.S.-listed spot bitcoin ETFs attracted $667.4 million in net inflows—the largest single-day figure since early May—highlighting a resurgence in institutional demand as bitcoin remains firmly above the $100,000 threshold.

The iShares Bitcoin Trust (IBIT) alone accounted for $306 million of these inflows, raising its cumulative net inflows to nearly $46 billion, according to Farside Investors.

This uptick aligns with bitcoin’s strong momentum, holding steady above $100K for 11 consecutive days, boosting market sentiment and investor confidence.

Simultaneously, the basis trade—where investors simultaneously go long on spot ETFs and short bitcoin futures on CME—has gained renewed appeal, with annualized yields climbing close to 9%, almost doubling April’s levels.

CME futures activity surged on Monday, with trading volumes reaching $8.4 billion (approximately 80,000 BTC), the highest since late April, and open interest rising to 158,000 BTC, a 30,000-contract increase from April lows. These metrics underscore growing participation in arbitrage and leveraged strategies.

Despite this rise, current futures volumes and open interest remain below January’s peak during bitcoin’s all-time high near $109,000, suggesting significant room for continued expansion.

The widening basis spread is enticing back investors who exited earlier in the year. For instance, the Wisconsin State Pension Board reportedly liquidated its ETF holdings in Q1 amid a less favorable basis but may be poised to reenter in Q2 as improved arbitrage opportunities emerge, with 13F filings typically reflecting a quarter’s lag.