The post Bitcoin Breaks $99k, But Analyst Warns Rally Leverage Driven appeared on BitcoinEthereumNews.com.

Bitcoin has seen a recovery above $99,000 recently, but the trend taking place in the Open Interest could raise concerns about the surge’s longevity. Bitcoin Open Interest Has Spiked Alongside The Latest Rally In a new post on X, CryptoQuant community analyst Maartunn talked about the trend in the Bitcoin Open Interest alongside the latest price rally. The “Open Interest” here refers to an indicator that keeps track of the total amount of positions related to BTC that are currently open on all derivatives exchanges. When the value of this metric rises, it means the derivatives users are opening fresh positions. Generally, the total amount of leverage goes up in the sector as new positions pop up, so this kind of trend can lead to higher volatility for the asset’s price. On the other hand, the indicator’s value registering a decline implies the holders are either closing up positions of their own volition or getting liquidated by their platform. The cryptocurrency may act in a more stable manner following such a leverage flushout. Now, here is the chart shared by the analyst, that shows the trend in the Bitcoin Open Interest, as well as its 24-hour percentage change, over the last week: The value of the metric appears to have shot up during the past day | Source: @JA_Maartun on X From the above graph, it’s visible that the Bitcoin Open Interest has seen a rapid increase alongside the latest recovery rally in the coin’s price. At the peak, the 24-hour percentage change hit the 7.2% mark, which is quite significant. While it’s normal for speculative activity to follow a sharp move in the cryptocurrency, an excess of it can still be an alarming sign. This is because in a high-leverage environment, the chances of a mass liquidation event can…

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Filed under: News - @ February 22, 2025 2:14 pm