Crypto analysts have noticed that open interest in Bitcoin and altcoins is once again forming a structure that previously ended with a market drop.
Open interest in Bitcoin and altcoins is rising again
In a recent post on X, analyst from the CryptoQuant Maartunn community noted that open interest in Bitcoin and altcoins is rising again. This indicator shows how many positions are currently open on derivatives exchanges — both longs and shorts.
When the metric goes up, it means more speculators are entering the market. Traders are opening new trades, often with high leverage, which adds volatility. And if interest falls, it means players are either closing their positions themselves or are being forcibly liquidated. In such cases, the market usually becomes calmer.
On the chart published by Maartunn, you can see how open interest in Bitcoin and altcoins has gone up again in recent days.
The metric has grown for both asset groups in recent days. Source: JA_Maartun/X
Open interest in Bitcoin surged along with the latest rally. This means that investors began actively opening positions in the derivatives market. Such dynamics are not surprising — price growth always attracts attention, especially when it leads to a new all-time high.
But the scale and speed of this growth raise questions. In such conditions, the market becomes vulnerable to a ‘liquidity squeeze,’ when mass liquidations intensify the decline. An additional alarming signal is the parallel growth of open interest in altcoins. This indicates that speculative activity has increased across the entire sector at once.
See also: Polygon activated the Rio upgrade to speed up the network and optimize blocks
Maartunn reminds that a similar situation already occurred in December 2024. Back then, the market stagnated sideways for a long time, and then collapsed by more than 30%.
The market has already started to react to the overheated situation. In a day, Bitcoin dropped from $125,000 to less than $121,000, but later returned to $123,000. The movement was sharp and accompanied by high volatility. Ether and other major altcoins are still under pressure and show no signs of recovery.
According to CoinGlass, the volatility spike led to liquidations of nearly $644 million in the crypto derivatives market.
The data reflects liquidations over the past 24 hours. Source: CoinGlass
At the time of publication, Bitcoin is trading around $122,900, up more than 5% over the past week.
BTC price dynamics over the past five days. Source: TradingView
