Bitcoin at risk of further decline amid leverage peak and 'huge' Ethereum rotation

Bitcoin's recent price weakness may not be over yet, according to K33, with a leverage surge and significant rotations into Ethereum leaving the foremost cryptocurrency vulnerable to further downside in the near term.

Bitcoin perp open interest has surged to a two-year high above 310,000 BTC ($34 billion), raising the risk of long-side liquidations, K33 Head of Research Vetle Lunde warned in a new report.

Meanwhile, a long-term whale rotated 22,400 BTC into ETH last week, helping drive Ethereum to a new all-time high of $4,956 and flipping market momentum, with the ETH/BTC ratio jumping above 0.04 for the first time this year — fueling end-of-cycle concerns.

However, "while the relationship between former ETH ATHs and BTC is concerning, we've yet to reach a situation that significantly points toward broad altcoin froth," Lunde reassured participants.