Glassnode Warns of Historic Low Levels in BTC Three-Month Futures Basis

The three-month futures basis for Bitcoin has been yielding below the U.S. two-year Treasury yield since February of this year, continuing for several months. Historically, there has only been one similar situation that lasted nearly as long, from August 2022 to January 2023, which corresponded to the previous market cycle's low point. The prolonged low futures basis reflects weak market leverage demand, directly impacting market depth and trading volume. The futures basis is used to gauge market risk appetite and the demand for arbitrage funds. When the basis yield falls below the risk-free rate, the additional returns investors earn from holding Bitcoin futures to take on risk are insufficient, potentially leading to a decrease in capital entering the futures market, affecting liquidity and trading activity.

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