Close Menu
Bitcoin

Bitcoin futures open interest hits all-time high

No Comments3 Mins Read

Open interest for bitcoin futures on centralized exchanges has hit an all-time high, according to Coinglass data.

The surge in open interest has surpassed November 2021 levels, when bitcoin reached its all-time high of over $68,000. It also highlights increased trading activity around the largest cryptocurrency.

According to CoinGlass, the aggregated open interest for bitcoin futures reached over $26 billion on Friday, higher than the final quarter of of 2021, when open interest peaked at $24 billion.

Since the start of 2024, open interest in bitcoin futures has increased, aligning with the digital asset’s price rally to a recent high of over $64,000, reached earlier this week .

Open interest, a measure of the total value of all outstanding bitcoin futures contracts across exchanges, is an indicator of increased market activity and trader sentiment around a particular asset.

Bitcoin BTC
-0.30%
 futures open interest reached an all-time high on Friday March 1. Image: Coinglass.

 

This surge in open interest is corroborated by The Block’s Data Dashboard, which shows bitcoin futures open interest on exchanges such as Binance, OKX, Deribit and others has reached a high of over $21 billion.

 

Uptick in retail-focused activity

Friday’s QCP Capital market update said that retail-focused exchanges like Binance were leading the price action with bitcoin perpetual futures over the past week, which were trading at $70 to $80 premiums to the spot price. “Bitcoin’s recently rally to over the $64,000 mark has also been driven by a frenzy of speculative retail buying,” the report added.

 

According to Coinbase’s Weekly Market Report, the open-interest weighted average funding rate reached 109% annualized on February 28, a level not seen since April 2021, according to Glassnode. “Between February 25 to 28, nearly $750 million of shorts were liquidated – each day successively creating a new year-to-date high in the amount of liquidated shorts. Meanwhile, we think we may be approaching the end of short covering based on the long-to-short ratio on futures, but it’s not entirely done yet,” Coinbase analysts added.

 

The Coinbase report also noted that the recent positive movement in funding rates and open interest could lead to consequences if the unwinding of positions triggers a cascade of long liquidations. “However, we are still overall constructive in our outlook over the next several months as spot ETFs continue to be onboarded to wealth management firms and net inflows absorb liquid circulating supply at a faster rate than bitcoin miners produce,” Coinbase analysts added.


Disclaimer: The Block is an independent media outlet that delivers news, research, and data. As of November 2023, Foresight Ventures is a majority investor of The Block. Foresight Ventures invests in other companies in the crypto space. Crypto exchange Bitget is an anchor LP for Foresight Ventures. The Block continues to operate independently to deliver objective, impactful, and timely information about the crypto industry. Here are our current financial disclosures.

© 2023 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Source link

See also  Is Bitcoin at risk from Ethereum ETFs? Peter Schiff explains
Share.

Related Posts

Leave A Reply