Bitcoin Open Interest Drops to 2022 Levels Amid Market Deleveraging
The Bitcoin #BTC open interest has fallen to levels seen during the late 2022 FTX collapse, indicating a notable decline in futures contracts across major crypto exchanges for the first time in over three years.
- Binance experienced a drop of 1.53 million BTC in its 30-day open interest change.
- Bybit saw a decrease of 784,000 BTC, Gate 505,000 BTC, and OKX 395,000 BTC.
This indicates a reduction in active futures contracts, with total BTC open interest currently at $62 billion, down from an all-time high of over $94 billion on Oct. 7. The drop reflects deleveraging as traders close risky positions.
Despite the decline, this may not signal a bearish trend. Such leverage flush-outs often precede market stabilization or reversal.
Bitcoin's current price is $90,900, showing little movement in the past 24 hours.
A Market Reset
January began with a surge in the crypto market, with Bitcoin exceeding $94,000. A local high of $94,700 was reached on Jan. 6, supported by bullish technical indicators like the MACD.
ETF-related headlines contributed to Bitcoin's initial upward momentum. However, Bitcoin's fall below $90,000 resulted in a significant selloff, with over $450 million in daily liquidations.
Morgan Stanley filed for an Ethereum #ETH ETF, causing a temporary spike in ETH and altcoin prices.
Spot BTC ETFs in the US have recorded a net outflow of $1.12 billion over the past three days. Analysts suggest market participants are "de-risking" ahead of upcoming US economic data releases.
The near-term outlook suggests further consolidation or mild rebounds without immediate breakouts.