Data shows that interest in Bitcoin openness has risen sharply as the price of cryptocurrencies has recovered over $87,500.
Bitcoin open interest grows by more than $2 billion
As Secret Community Analyst Maartunn noted in a new post on X, open interest in the past day has attracted Bitcoin interest. “Open interest” here refers to an indicator that measures the total number of BTC-related positions currently open on all derivative exchanges.
When the value of the indicator rises, it means investors are opening new positions in the futures market. Usually, when new positions appear, the total leverage of the industry increases, so this trend can cause fluctuations in asset prices.
On the other hand, the declined indicator means that holders either close their will positions or are forcibly liquidated by their platform. In any case, this leverage flush can provide greater stability for cryptocurrencies.
Now, here is a chart shared by analysts showing how Bitcoin open interest has changed over the past 24 hours or so:
The value of the metric appears to have gone through an increase | Source: @JA_Maartun on X
As shown in the above image, Bitcoin open interest witnessed a sharp rise in this window. The increase in the indicator has reached as the price of the coin has recovered to $87,500.
This is not surprising, as exciting price action in cryptocurrencies often leads to speculation. However, it may be worrying that the scale of the increase observed by the indicators.
As Maartunn highlights in the chart, open interest has increased by $2 billion in the past few days, meaning a percentage increase of more than 8.3%.
As Coinglass data shows, this massive growth is still seen, although Bitcoin has seen about $76 million in liquidation.
The heatmap for the liquidations in the cryptocurrency sector | Source: CoinGlass
Leverage-driven gatherings Latest trends like this tend not to continue because the basic conditions present in them are often unstable. The reason behind this instability is that the leverage position is easily liquidated.
Locations that appear during rally hype are often over-progressed, if not, their liquidation points are usually at a height within the rally. This means they may be susceptible to any callbacks that occur.
When these locations find liquidation, they feed back to the price that causes them to drop, thus lengthening their length. Something similar could happen to the final Bitcoin rally, but it’s just something to be seen.
BTC price
The Bitcoin recovery volume has cooled over the past few days, but it seems that the last 24 hours have brought bullish momentum as the coin managed to grow by more than 3%.
Looks like the price of the coin has shot up | Source: BTCUSDT on TradingView
Dall-E, Coinglass.com, Featured Images of Coinalyze.net, TradingView.com Charts
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