Bitcoin futures open interest hits all-time high

by Brian McGleenon

Markets • March 1, 2024, 10:14AM EST

Published 1 minute earlier on

The Block

Quick Take

Open interest for bitcoin futures on centralized exchanges reached an all-time high after the recent price rally.
Aggregated open interest for bitcoin futures stands at over $26 billion, according to Coinglass data.

Open interest for bitcoin futures on centralized exchanges has hit an all-time high, according to Coinglass data.

The surge in open interest has surpassed November 2021 levels, when bitcoin reached its all-time high of over $68,000. It also highlights increased trading activity around the largest cryptocurrency.

According to CoinGlass, the aggregated open interest for bitcoin futures reached over $26 billion on Friday, higher than the final quarter of of 2021, when open interest peaked at $24 billion.

Since the start of 2024, open interest in bitcoin futures has increased, aligning with the digital asset's price rally to a recent high of over $64,000, reached earlier this week .

Open interest, a measure of the total value of all outstanding bitcoin futures contracts across exchanges, is an indicator of increased market activity and trader sentiment around a particular asset.

Bitcoin BTC -4.27% futures open interest reached an all-time high on Friday March 1. Image: Coinglass.

This surge in open interest is corroborated by The Block's Data Dashboard, which shows bitcoin futures open interest on exchanges such as Binance, OKX, Deribit and others has reached a high of over $21 billion.

Uptick in retail-focused activity

Friday's QCP Capital market update said that retail-focused exchanges like Binance were leading the price action with bitcoin perpetual futures over the past week, which were trading at $70 to $80 premiums to the spot price. "Bitcoin's recently rally to over the $64,000 mark has also been driven by a frenzy of speculative retail buying," the report added.

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According to Coinbase's Weekly Market Report, the open-interest weighted average funding rate reached 109% annualized on February 28, a level not seen since April 2021, according to Glassnode. "Between February 25 to 28, nearly $750 million of shorts were liquidated – each day successively creating a new year-to-date high in the amount of liquidated shorts. Meanwhile, we think we may be approaching the end of short covering based on the long-to-short ratio on futures, but it's not entirely done yet," Coinbase analysts added.

The Coinbase report also noted that the recent positive movement in funding rates and open interest could lead to consequences if the unwinding of positions triggers a cascade of long liquidations. "However, we are still overall constructive in our outlook over the next several months as spot ETFs continue to be onboarded to wealth management firms and net inflows absorb liquid circulating supply at a faster rate than bitcoin miners produce," Coinbase analysts added.

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About Author

Brian McGleenon is a UK-based markets reporter for The Block. He has worked as a financial journalist and producer for multiple news outlets over the years, such as Fuji Television, The Independent, Yahoo Finance, The Evening Standard, and The Daily Express. Brian is also a screenwriter and producer with one feature film produced and one in development with Northern Ireland Screen. Apart from web3 and cryptocurrency developments, he is also interested in geopolitics, environmental issues, artificial intelligence, and longevity research. Get in touch via email [email protected].