Bitcoin Leverage Reset: Futures Open Interest Plummets 30%

Crypto analytics provider Glassnode argues the late February BTC crash may have been a healthy reset that flushed excessive leverage out of the market. According to on-chain analytics provider, Glassnode, the late-February crypto market correction may have purged excessive leverage from the markets.On March 1, Glassnode published a report analyzing the recent crypto crash — which was only the second significant crypto correction since the markets pushed into new record highs in late 2020.Glassnode noted the crash peaked with a 25% fall from the local top of $58,300 to $43,343. As such, the....

On-chain data shows both the Bitcoin leverage ratio and the futures open interest has spiked up recently, a sign that may turn out to be bearish for the crypto’s price. Bitcoin Estimated Leverage Ratio And Open Interest Surge Up As pointed out by an analyst in a CryptoQuant, the BTC futures market seems to have […]

Bitcoin has been highly volatile in recent weeks, but the futures market’s open interest indicates that traders should brace themselves for a big move. Bitcoin (BTC) has been highly volatile in recent weeks, rallying above $16,000 for the first time in three years. But the futures market’s open interest indicates that a large volatility spike is likely very close.The term “open interest” refers to the total sum of contracts that are actively open in the futures market. If the open interest is high, it means there is a high number of traders betting on Bitcoin price action.Bitcoin futures....

Ethereum is undergoing one of the most significant resets in over a year, caused by its price breaking below $4,000. This retest has been most visible in futures open interest, where billions of dollars in positions have been wiped out across major exchanges. This rapid unwinding comes as a correction move to weeks of excessive leverage during uptrends that had pushed derivatives activity to unsustainable levels. Related Reading: When Will XRP Reach $25? Bitcoin Investor Shares A Bold Prediction Massive Open Interest Wipeout Across Major Exchanges The most recent Ethereum price correction....

Bitcoin’s recent gains appear to have been driven by leverage-fuelled speculation, with open interest in futures and Binance’s leverage ratio pushing into new highs. On Nov. 4, crypto data market aggregator CryptoQuant published a chart indicating Binance’s Estimated Leverage Ratio — open interest divided by Bitcoin (BTC) reserves — has pushed into new all-time highs.The record was set on Nov. 3 after a spike in open interest pushed Binance’s ELR above 0.18 for the first time. The spike in ELR came shortly before Bitcoin established a double-bottom at roughly $13,400. New data suggests....