Contrasting currents in crypto market as Bitcoin futures plunge, crypto-margin soars

Crypto-margin futures rise amid general Bitcoin contract decline

This article was published 3 years ago. Some details may no longer reflect current market conditions or recent developments. If you spot anything that needs an update, contact us.
Make preferred on Google logo

Quick Take

The recent data analysis indicates a critical shift in Bitcoin futures contracts, particularly in the wake of the Grayscale lawsuit. Bitcoin open interest, the total number of outstanding futures contracts, has suffered a significant reduction, with a rough estimate of 400,000 Bitcoin in futures contracts representing one of the lowest readings year-to-date.

The diminishing liquidity signals a potential change in investor sentiment or strategic investment decisions.

Open Interest: (Source: Coinglass)
Open Interest: (Source: Coinglass)

Interestingly, while overall Bitcoin futures contracts have declined, crypto-margin futures contracts assert a contrary trend. Crypto-margin refers to futures contracts with open interest margined in the native cryptocurrency (Bitcoin, in this case) rather than a traditional currency like USD or a stablecoin.

The crypto-margin is set to reach new year-to-date highs, with approximately 135,000 Bitcoin, or around 33% of all open interest contracts, being placed in the crypto margin.

Crypto margin: (Source: Glassnode)
Crypto margin: (Source: Glassnode)