This means the futures price of Bitcoin is higher than its spot price.
Because the trade entails that investors simultaneously long and short an asset, it is fully hedged and essentially risk-free.
For example, at the close of trading on April 9, Bitcoin spot was at just above $58,300 while the December 2021 CME contract was over $63,000.
Some investors might say that the 8% return pales in comparison to Bitcoin’s over 800% return in the past year, but the emphasis here is the almost risk-free nature of the trade.
Meanwhile, speculative investors have continued to gain economic exposure to Bitcoin through futures.
But Bitcoin watchers are familiar with the token’s notorious volatility, which is now also part of the trade.
“It’s more complicated for retail investors based in the US, for sure, but it’s not impossible,” CoinDesk’s Acheson said.