Bitcoin Open Interest Remains High Despite Price Drop, What’s The Significance?

Bitcoin Open Interest Remains High Amid Price Correction

Despite a recent price decline, Bitcoin's open interest has remained elevated, suggesting that investors maintain a favorable outlook for the cryptocurrency.

Bitcoin Open Interest Near All-Time High

Bitcoin's price has dropped from over $70,000 to below $66,000 in the past week, a decline typically reflected in open interest. However, data from Coinglass indicates that open interest has held steady near its all-time high.

On June 6, Bitcoin's open interest reached a record $36.87 billion. As of writing, it stands at $33.84 billion, indicating a modest decline of approximately 10% over the last two weeks. This suggests ongoing investor interest and continued position-taking.

Open Interest Measures Futures and Options Contracts

Open interest measures the total number of futures and options contracts for an asset currently open in the market. A low open interest indicates traders are taking fewer positions. Thus, Bitcoin's elevated open interest remains a significant indicator.

Price Crash Triggers Liquidations

The Bitcoin price drop has led to liquidations of approximately 44,000 traders in the past 24 hours. The total dollar value of liquidations is estimated at $111 million. Bitcoin tops the list with over $30 million in liquidated positions, followed by Ethereum with $22.65 million.

Short positions have suffered the most liquidations, with 50.93% being on the short side. However, as the price recovers, there has been a shift, with shorters losing at a rate of 71.29% in the past hour.

The largest single liquidation order occurred on the BTCUSD pair on the Bybit exchange, where a trader was liquidated for $8.09 million. The majority of liquidations have taken place in the past 24 hours, with $80 million lost.