On-chain data shows Bitcoin futures open interest has jumped up more than $1.5 billion in just a few hours as the crypto’s price breaks past $44k again.
Bitcoin Futures Open Interest Adds More Than $1.5 Billion Within A Few Hours
As pointed out by an analyst in a CryptoQuant post, the BTC open interest has shot up over the past day as the coin’s price has observed a surge.
The “open interest” is an indicator that measures the total amount of Bitcoin futures contracts currently open on all derivatives exchanges.
When the value of this metric is rising, it means more futures positions are opening up on exchanges. This leads to higher leverage in the market, and can result in more volatility.
On the other hand, the open interest’s value going down suggests investors are closing up their positions as they pull out of the market. As leverage lowers during this trend, it can lead to lesser volatility in the price of Bitcoin.
Now, here is a chart that shows the trend in the Bitcoin open interest over the past month:
Looks like the value of the indicator has surged up over the past day | Source: CryptoQuant
As you can see in the above graph, the BTC open interest observed a sharp rise within the last 24 hours as the coin’s price enjoyed an uptrend.
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The value of the metric jumped more than $1.5 billion in just the matter of a few hours, taking the total open interest to $13.6 billion.
Also, as the chart shows, there were two similar sharp spikes twice within the past thirty days where the price also saw an increase.
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However, not long after this trend, the price plummeted down along with the open interest. If similar trend follows this time as well, the current uplifted value of the coin may not last long before a retrace is seen.
Though, there is a chance that things go differently this time. The increase in the Bitcoin open interest is much sharper than the other instances.
BTC Price
Yesterday, Bitcoin’s price broke past $44k for the first time since start of March. So far, the coin has maintained above this level as at the time of writing, it floats around $44.6k, up 10% in the last seven days.
Over the past month, the crypto has gained 15% in value. The below chart shows the trend in the price of the coin over the last five days.
The price of BTC seems to have observed some sharp uptrend over the last few days | Source: BTCUSD on TradingView
Featured image from Unsplash.com, charts from TradingView.com, CryptoQuant.com
