Institutional investors unwind Bitcoin arbitrage trades as yields decline

Institutional interest in Bitcoin (BTC) arbitrage strategies is waning as returns decrease. According to CoinDesk, institutions are unwinding cash-and-carry, or basis trading strategies, which involve taking a long position in Bitcoin spot ETFs while shorting CME Bitcoin futures. This delta-neutral trade allows investors to secure profits with minimal risk. However, expected yields have dropped to around 2%, the lowest since Bitcoin spot ETFs were approved. With U.S. Treasuries offering higher returns, investors are shifting to safer assets.