Bitcoin Open Interest Remains Elevated Post Dramatic Dip
December 01 2021 - 1:00PM
NEWSBTC
Data shows Bitcoin open interest has remained high despite the
dramatic sell-off that occurred a few days back due to fud from the
new COVID variant. Bitcoin Open Interest Remains High Following The
Sell-Off As per the latest weekly report from Arcane Research, the
BTC open interest hasn’t fallen much in the past few days. This is
despite the recent sell-off triggered by fresh fud from the new
Omicron COVID variant. The “open interest” is an indicator that
measures the amount of Bitcoin derivative contracts open at the end
of a trading day. High values of the metric can mean there is
excessive leverage in the market. This could lead to higher
volatility in the price of the cryptocurrency. On the other hand,
low values of the open interest may lead to lesser volatility as
there isn’t much leverage in the market. Now, here is a chart that
shows the trend in the value of this Bitcoin indicator over the
past year: Looks like the open interest has been very high recently
| Source: The Arcane Research Weekly Update - Week 47 As you can
see in the above graph, the value of the Bitcoin open interest has
remained quite high recently, despite the crash. The metric has
been trending down when measured in the USD, but it has remained
above a certain level when denominated in BTC. Related Reading
| Bitcoin Aims Fresh Run To $60K, Why Bulls Could Face Hurdles
Currently, the Bitcoin open interest sits around $22 billion, or
380k BTC. This is a high value when compared historically. Also, as
the chart shows, the indicator’s value has remained above 365k BTC
for more than a month now. It’s uncommon that these kind of high
values are sustained for such a long time. As the report notes,
this could mean the market currently has a lot of excess leverage.
Related Reading | Exchanges See Bitcoin Outflows For 7th
Straight Day As BTC Price Begins Recovery The graph also has curves
showing the share of the major derivatives exchanges out of the
total Bitcoin open interest. Following the launch of the
futures-based ETF, CME’s share in the market saw a sizeable drop.
However, yesterday the exchange’s share saw a sharp increase, and
now its open interest share sits at 20%. Bybit’s open interest has
seen significant growth recently. The report suggests that spikes
in this exchange’s share have previously lead to sharp price
fluctuations in Bitcoin so it might be worth paying attention to
the upcoming trend of the exchange’s open interest. BTC Price At
the time of writing, Bitcoin’s price floats around $57.3k, up 1.3%
in the last seven days. The below chart shows the trend in the
price of BTC over the past five days. BTC's price shows recovery
from the crash | Source: BTCUSD on TradingView Featured image from
Unsplash.com, charts from TradingView.com, Arcane Research
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