Open interest (OI) in Bitcoin futures and perpetual pairs on centralized exchanges (CEXs) has risen to all-time highs following BTC's unbroken 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 investor confidence in a rally ahead the halving that pushes BTC price to 2021 and beyond ATH of $69,000.
Increase in open Bitcoin interest
Open interest in Bitcoin futures and perpetual pairs represents the cumulative value of all unsettled Bitcoin futures contracts. The metric serves as a measure of market sentiment and investor commitment to BTC.
Bitfinex cited an analysis by crypto futures market data platform Coinalyze that found total Bitcoin OI across multiple decentralized exchanges (DEXs) also rose to $41.8 billion last week. Analysts have noted the increase in OI on CEXs and DEXs since January 2024 and found that it correlates with the increase in BTC price.
Bitcoin's 44% surge in February and its recent surge to a new all-time high were driven primarily by inflows into spot BTC exchange-traded funds (ETFs). In less than two months after their launch, the ETFs have acquired over 146,522 BTC worth more than $7.5 billion, far exceeding all forecasts.
The average expectation for ETF inflows in the first year was $28 billion; However, due to the growth to date, the products are well ahead of schedule. With billions of dollars of capital from management consultants such as Morgan Stanley, Wells Fargo and Bank of America yet to enter the ETF space, the sector still has enormous untapped growth potential.
Altcoin season is heating up
On the other hand, altcoins have continued to gain traction and are showing signs of an upcoming altcoin season, a time when crypto assets, apart from BTC, see large capital inflows and an increase in market speculation.
Bitfinex believes the crypto market may be at the start of an altcoin season, evidenced by a 50 percent increase in TOTAL3, an index for all cryptocurrencies except BTC and Ether. The index's market capitalization has risen significantly to $640 billion from its bear market record of $450 billion.
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