Bitcoin (BTC) has rallied past its all-time highs, reaching an unprecedented $72,000 on March 11.
Bitcoin (BTC) has rallied past its all-time highs, reaching an unprecedented $72,000 on March 11. This 9.5% surge over the past week has been volatile, marked by a 4.8% intraday jump followed by a 5.9% dip. Despite the milestone, Bitcoin bulls remain cautious due to a concerning rise in leverage through Bitcoin futures contracts.
The current open interest in Bitcoin futures sits at a staggering $35.8 billion, raising concerns about overreliance on leveraged positions. While this data reflects investor interest, it doesn't guarantee a bullish trend. However, this does signal potential volatile swings in the price of Bitcoin.
Furthermore, the Chicago Mercantile Exchange (CME) now holds the largest share of Bitcoin futures, surpassing traditional crypto exchanges. However, this dominance wasn't present during the November 2021 peak, which was followed by a rapid 31.5% price decline. In terms of Bitcoin open interest specifically, the current figure is 27% lower than its October 2022 peak.
Despite its limitations, the current 495,380 BTC in open interest is significant enough to trigger sharp volatility when prices fluctuate. This was evident on March 4, when a massive $325 million in leveraged positions was liquidated.
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