The crypto market has steadily declined since the start of the year. Bitcoin is 56% below its opening price for the year and altcoins have taken after BTC in the path of decline. Despite the extremely bearish market conditions, the open interest for Bitcoin has recently soared.
At the moment, the Binance exchange has the largest volume of Bitcoin interest in the futures market. Earlier on, the FTX exchange has the second largest volume. More recently though, FTX has been tumped.
OKX now has the second-largest market share of Bitcoin. In the past month, open interest for BTC on OKX has grown from 13% to 27%. During this same period, the open interest in several other exchanges remained stagnant.
The majority of the flows of the Bitcoin futures contract volume on OKX will expire in September, while a few contracts will expire in December.
The increase in open interest for BTC on OKX may be attributed to the platform’s appetizing yield. OKX currently offers the best annual gains for Futures contracts. The exchange increased its yield to 2.2% last month. This increase may have triggered the surge in BTC Futures volume on the exchange.
The Open Interest Indicator
In the crypto market, a rise in open interest reveals that new money is flowing into the market. However, a decline in open interest indicates that more traders are getting liquidated. Typically, after intense liquidations, the market trend tends to reverse.
While the indicator can be used to predict market sentiments and project the strength behind market trends, it is best used in combination with other price pointers.
Since Bitcoin fell below $24,000 about a month ago, the flagship crypto asset has failed to recover fully. Bitcoin currently trades below $20,000, and its market cap is less than $400 million.
