Open interest (OI) in Bitcoin futures and perpetual pairs on centralized exchanges (CEX) rose to an all-time high following BTC’s steady rally to levels not seen since November 2021.
According to Bitfinex’s latest weekly report, OI for Bitcoin futures and perpetual pairs reached $26 billion, surpassing the previous record of $24 billion set in the fourth quarter of 2021. This increase signals growing confidence of investors in a pre-halving rally that will push the price of BTC into 2021 and beyond. ATH of $69,000.
Bitcoin open interest rising
Open interest for Bitcoin futures and perpetual pairs represents the cumulative value of all unsettled Bitcoin futures contracts. The metric serves as an indicator of market sentiment and investor engagement with BTC.
Bitfinex cited an analysis by crypto futures market data platform Coinalyze, which found that Bitcoin’s total OI across multiple decentralized exchanges (DEXs) also increased to $41.8 billion last week. Analysts have noted the increase in OI between CEX and DEX since January 2024, determining that it is related to the increase in BTC price.
Bitcoin’s 44% surge in February and its latest surge to a new all-time high were driven primarily by inflows into spot BTC exchange-traded funds (ETFs). In less than two months since their launch, the ETFs have acquired over 146,522 BTC worth over $7.5 billion, far exceeding all predictions.
The average expectation for first-year ETF inflows was $28 billion; however, growth so far has brought products significantly ahead of schedule. With billions of dollars of capital still to be injected into the ETF space by management consultants like Morgan Stanley, Wells Fargo and Bank of America, the sector still has vast untapped growth potential.
Altcoin season accelerates
On the other hand, altcoins continued to gain ground, showing signs of an impending alt season, which is a period where cryptocurrencies, aside from BTC, see a large inflow of capital and a spike in market speculation.
Bitfinex believes the cryptocurrency market may be at the beginning of an altcoin season, as seen in a 50% rise in TOTAL3, an index for all cryptocurrencies except BTC and ether. The index’s market capitalization has increased significantly from its bear market record of $450 billion to $640 billion.
