Bitcoin's Bounce Back to Over $88K Sparks Uncertainty Amid Increased Derivatives Activity

Bitcoin's recent recovery to nearly $89,000 has sparked concerns about the current market rally's durability, following an unexpected surge in open interest. Analysis from CryptoQuant indicates that price pumps driven by derivatives often lack sustainability, with recent 16% and 15% spikes in open interest echoing patterns seen in the bullish phase of November/December 2024.

However, current price movements are more subdued, suggesting significant selling pressure and a potentially weaker rally. Despite these concerns, Bitcoin's Realized Capitalization recently hit a record $872.2 billion, indicating market confidence and accumulation. This suggests that more capital is flowing into Bitcoin, with investors choosing to hold rather than sell.