Bitcoin Open Interest Drops to Lowest Level Since August as Leverage Unwinds
Binance open interest falls below 100,000 BTC, marking a 12-month low.
Bitcoin (BTC) open interest (OI) has hit its lowest level since August, currently standing at 413,000 BTC ($36 billion), according to Glassnode data. Open interest measures the total funds tied up in outstanding futures contracts and serves as an indicator of leverage in the Bitcoin market.
Since these contracts are denominated in dollars, their value fluctuates with BTC’s price. To eliminate price distortions, analysts often assess OI in Bitcoin terms, providing a clearer picture of leverage trends.
Glassnode data reveals that since November, Bitcoin open interest has fallen from 546,000 BTC to 413,000 BTC across all exchanges. A significant portion of this drop stems from the unwinding of CME open interest, particularly within the basis trade strategy.
During this period, Bitcoin’s price has swung from $109,000 down to $78,000 before rebounding to $90,000. This suggests that the recent rally has been primarily driven by spot demand rather than excessive leverage.
Binance, the second-largest exchange by open interest, has seen its OI decline to just over 100,000 BTC—its lowest level in more than a year. This suggests that retail traders have significantly reduced their leveraged positions, likely in response to heightened market volatility.
Additionally, Bitcoin’s open interest as a percentage of its total market cap has fallen below 2% for the first time since February 2024, signaling a broader shift away from speculative trading and leverage-driven price action.
