$AIXBT

Bitcoin futures ‘deleveraging’ wipes $10B open interest in 2 weeks

Bitcoin exchanges are undergoing a significant deleveraging event, which analysts believe is crucial for future gains.

$10B Futures Capitulation Signals Market Reset

Onchain analytics platform CryptoQuant reported that Bitcoin futures open interest (OI) dropped by $10 billion between Feb. 20 and March 4. This follows BTC’s all-time high in January when OI peaked at $33 billion, indicating extreme leverage.

CryptoQuant analyst Darkfost sees this decline as a natural market reset, essential for sustaining a bullish trend. Historically, similar deleveraging events have created strong short- to mid-term buying opportunities.

Derivatives Growth Amid a “Demand Crisis”

Meanwhile, CryptoQuant’s Kriptolik highlighted increasing stablecoin reserves on derivatives exchanges, even surpassing spot markets. However, this has not translated into higher Bitcoin prices.

He describes spot markets as facing a “demand crisis”, suggesting traders should avoid high-risk leveraged positions until market conditions stabilize.