Open interest in Bitcoin derivatives reached an all-time high on October 21st as the price of BTC approached $70,000. CoinGlass reported in a post on X that the open interest on Bitcoin futures contracts had reached a record-breaking $40.5 billion. Open interest refers to the value or number of outstanding futures contracts that have not yet expired. It serves as a measurement of the amount of money invested in Bitcoin derivatives at any given time, with higher open interest indicating potentially greater leverage and volatility within the system.
The Chicago Mercantile Exchange (CME) held the largest share of the open interest at 30.7%, followed by Binance at 20.4% and Bybit at 15%. During periods of high open interest, sharp price movements can trigger cascading liquidations, leading to selling in the spot market and resulting in significant drops in the price of BTC. A recent example of this occurred in early August when BTC prices plummeted by nearly 20% or around $12,000 in less than two days, causing the price to fall below $50,000.
Currently, BTC is trading at a high of $69,380, according to TradingView, but it faced resistance and has since pulled back to $69,033 at the time of publication. CoinGecko data shows that BTC is just 6.4% below its all-time high of $73,738.
In a previous report, Cointelegraph stated that if BTC rallies above $70,000, it could potentially boost altcoins like Ether (ETH) and Solana (SOL). Both assets have been outperforming BTC in terms of daily gains, with Ether increasing by 3.5% to reach over $2,750, and Solana seeing a 6% gain, coming close to $170 during early trading on October 21st. However, both assets have experienced slight pullbacks since then.
In other news, Hodler’s Digest from October 13th to 19th highlighted a forecast of Bitcoin reaching $233,000, the arrest of a hacker who targeted SEC X accounts, and more.