PANews January 15 News, according to Cointelegraph, data from CryptoQuant shows that open interest (OI) in the Bitcoin derivatives market has decreased by about 30% since October last year. Analysts point out that this “deleveraging signal” helps clear the market of excess leverage accumulated. Historically, similar significant declines often mark important market bottoms, laying a firmer foundation for a potential bullish recovery. However, if Bitcoin prices continue to decline and enter a full bear market, open interest may further shrink, indicating deeper deleveraging and an extended adjustment period.
On October 6 last year, Bitcoin’s open interest reached a historical peak of over $15 billion. Currently, in a scenario where prices are rising while open interest is decreasing, it usually indicates that leveraged short positions are being closed or liquidated. This “short squeeze” situation could be favorable for Bitcoin, as the price increase is driven more by spot buying rather than excessive leverage. However, derivatives provider Greeks Live pointed out that the derivatives market has not yet entered a structurally bullish phase, and the current trading structure more resembles a passive reaction to sudden price increases.
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