Analyst: Binance BTC open interest plunges as deleveraging sends a healthy signal for the market
Nov. 12 — Data monitored by CryptoQuant analyst Darkfost shows that the Bitcoin market on Binance is showing signs of a new round of deleveraging, with liquidations on the exchange reaching their highest level since 2021.
The data shows that in less than a month, Bitcoin open interest on Binance fell from $10.6 billion to $8.8 billion, a 17% decline. Open interest also dropped below its 180-day moving average, a typical sign of deleveraging.
Historically, during bull market cycles, signals like these usually indicate that a correction is nearing its end. They reflect traders voluntarily closing positions or being forcibly liquidated, a process that often involves a concentrated clearing of market leverage risks.
In addition, Binance's monthly liquidation totals over the past three months reached their highest levels since 2021. Liquidations exceeded $1.4 billion in August, and totaled $1.1 billion and $1.3 billion in September and October, respectively. November is not yet halfway over, but liquidations have already surpassed $520 million.
The analyst believes that the low-volatility environment had prompted many traders to use leverage in pursuit of profits, but the risks associated with futures positions became apparent after the market reversed.
However, Darkfost noted that the deleveraging process can actually help improve market conditions. Clearing leveraged positions reduces the risk of cascading liquidations and allows spot buying to have a greater influence, helping Bitcoin develop a more solid market structure.
Notably, similar liquidation signals also appeared in June. At the time, BTC was trading below $60,000, but the market subsequently rebounded strongly, with the price climbing to $87,000—a cumulative gain of more than 45%.
However, historical signals are only a point of reference. Whether the current market can replicate the strong rebound seen previously remains to be seen, and will require continued monitoring of changes in market liquidity, fund flows, and broader macroeconomic conditions.
#BTC去杠杆
Nov. 12 — Data monitored by CryptoQuant analyst Darkfost shows that the Bitcoin market on Binance is showing signs of a new round of deleveraging, with liquidations on the exchange reaching their highest level since 2021.
The data shows that in less than a month, Bitcoin open interest on Binance fell from $10.6 billion to $8.8 billion, a 17% decline. Open interest also dropped below its 180-day moving average, a typical sign of deleveraging.
Historically, during bull market cycles, signals like these usually indicate that a correction is nearing its end. They reflect traders voluntarily closing positions or being forcibly liquidated, a process that often involves a concentrated clearing of market leverage risks.
In addition, Binance's monthly liquidation totals over the past three months reached their highest levels since 2021. Liquidations exceeded $1.4 billion in August, and totaled $1.1 billion and $1.3 billion in September and October, respectively. November is not yet halfway over, but liquidations have already surpassed $520 million.
The analyst believes that the low-volatility environment had prompted many traders to use leverage in pursuit of profits, but the risks associated with futures positions became apparent after the market reversed.
However, Darkfost noted that the deleveraging process can actually help improve market conditions. Clearing leveraged positions reduces the risk of cascading liquidations and allows spot buying to have a greater influence, helping Bitcoin develop a more solid market structure.
Notably, similar liquidation signals also appeared in June. At the time, BTC was trading below $60,000, but the market subsequently rebounded strongly, with the price climbing to $87,000—a cumulative gain of more than 45%.
However, historical signals are only a point of reference. Whether the current market can replicate the strong rebound seen previously remains to be seen, and will require continued monitoring of changes in market liquidity, fund flows, and broader macroeconomic conditions.
#BTC去杠杆
