Bitcoin Faces Volatility Risks Amid High Leverage, Analysts Still Eye Long-Term Surge
The post Bitcoin Faces Volatility Risks Amid High Leverage, Analysts Still Eye Long-Term Surge appeared on BitcoinEthereumNews.com.
Bitcoin is trading in a tight consolidation range near $105,000 after briefly spiking to $106,450, but analysts warn of increased volatility ahead due to excessive leverage in the derivatives market. On June 2, prominent technical analyst Willy Woo sounded the alarm, stating, “Now is a bad time to take paper bets on BTC.” He emphasized that Bitcoin is currently in “open season on liquidation hunts,” where whales exploit overleveraged positions in the futures market to trigger cascading sell-offs and price dips. “Spot BTC prices are hard to move up with too many casino hitchhikers onboard,” Woo noted, referring to the excessive use of leveraged instruments like futures, options, and perpetuals that distort true price action. According to Coinglass, open interest (OI) in BTC futures hit a record $80 billion on May 23 before slightly declining to $72 billion—still an alarmingly high level. Woo warned that such conditions are ripe for “liquidation flushes” that can amplify downward pressure. This warning comes just days after a $100 million liquidation hit prominent Hyperliquid trader James Wynn. Woo pointed to low spot buying pressure and seasonal thin trading as conditions enabling whales to manipulate prices. Cardano Eyes DeFi Bridge to Bitcoin as Altcoin Season Builds While Bitcoin wrestles with leverage-driven turbulence, Cardano (ADA) has surged 100%, thanks to rising interest in DeFi and multi-chain interoperability. Charles Hoskinson, Cardano’s founder, emphasized the platform’s goal to integrate Bitcoin into DeFi without compromising BTC’s core principles—such as requiring all transactions and returns in BTC. “We’ve created a way to connect Bitcoin to DeFi — without altering what makes Bitcoin unique,” said Hoskinson. Cardano also announced plans to incorporate XRP into its DeFi ecosystem, aiming to build a more interoperable, scalable, and globally inclusive blockchain network. Tom Lee Reaffirms Bullish Bitcoin Outlook Meanwhile, Tom Lee, co-founder of Fundstrat,…
Filed under: News - @ June 4, 2025 4:26 am