A divergence has formed in the crypto futures market during the past week as Bitcoin and Solana have seen deleveraging against the others.
On the other hand, the indicator registering a decline implies holders are either closing up positions of their own volition or getting forcibly liquidated by their platform. Such a trend usually leads to a reduction in leverage, which can make the price act in a more stable manner.
Now, first, here’s a chart that shows the trend in the Open Interest for Bitcoin over the past week:
As displayed in the above graph, the Bitcoin Open Interest has followed an overall downward trajectory in this period, a sign that a net amount of positions have disappeared.
Interestingly, this trend has developed alongside a recovery surge in the BTC price to the $117,000 level. Generally, rallies attract speculative activity so the indicator tends to rise with them, but it would appear that it hasn’t been the case this time around.
Thus, it seems both BTC and SOL have seen a cooldown in speculative activity even though their prices have witnessed a net increase over the past week. The same trend, however, hasn’t been seen with some of the other top digital assets.
The cryptocurrency number two only to Bitcoin, Ethereum, has witnessed a surge in the Open Interest, implying an increase in demand among the investors for leveraged positioning.
The analytics firm has pointed out that XRP and BNB have also observed a similar trend. Given this divergence that has formed between the assets, it’s possible that ETH and company may be in for higher volatility than BTC and SOL.
Bitcoin recovered to $117,900 on Wednesday, but it seems the coin has seen a minor pullback since then as it’s now back at $117,000.
