Bitcoin open interest slides to $34B amid liquidation wave

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Bitcoin OI drops to $34B

Highlights

Bitcoin is down 28% in a month; open interest fell to $34B after $5.2B in liquidations.
Funding rates stay below 12%, while options skew hit 22%, signaling downside hedging.
US Bitcoin ETFs still average $5.4B in daily volume, showing steady institutional demand.

Data from CoinGlass show aggregate Bitcoin futures open interest dropped to $34 billion on Thursday, down 28% from a month earlier and marking the lowest level since November 2024. However, measured in Bitcoin terms, open interest remains largely unchanged at about 502,450 BTC, suggesting leverage demand has not collapsed outright. Analysts note that roughly $5.2 billion in forced liquidations over the past two weeks contributed significantly to the decline in dollar-denominated open interest, Cointelegraph reports.

Derivatives signal caution despite ETF strength

Derivatives markets reflect a cautious tone. The annualized funding rate on Bitcoin futures has remained below the neutral 12% threshold for four consecutive months, indicating subdued appetite for bullish leveraged positions. Options markets show even clearer signs of risk aversion. The 30-day delta skew at Deribit climbed to 22% on Thursday, far above the typical -6% to +6% range that signals balanced sentiment, with put options trading at a premium to calls.

Some market observers attribute the weakness to macroeconomic uncertainty. The U.S. Labor Department reported that the economy added only 181,000 jobs in 2025, a softer figure than previously reported. Although the White House has downplayed the implications, citing slower population growth linked to immigration policy, concerns about labor market fragility have resurfaced. Historically, economic shocks have triggered sharp Bitcoin sell-offs, including its 52% plunge on March 13, 2020, during peak pandemic fears.

Yet not all indicators point to waning institutional demand. U.S.-listed Bitcoin exchange-traded funds have averaged $5.4 billion in daily trading volume, a level that challenges the notion of widespread abandonment by professional investors. Meanwhile, the S&P 500 trades just 1% below its all-time high, buoyed by expectations that the Federal Reserve may cut rates if economic conditions weaken.

A market at a crossroads

Bitcoin’s current decoupling from stocks and gold underscores investor uncertainty. While futures positioning signals caution, ETF activity suggests institutions remain engaged. The next directional move may hinge less on crypto-specific catalysts and more on clarity around U.S. economic growth and monetary policy.

Why this matters

Bitcoin’s price action is increasingly tied to macroeconomic expectations rather than isolated crypto developments. If labor-market softness prompts rate cuts, liquidity conditions could improve, potentially benefiting risk assets—including Bitcoin. Conversely, prolonged uncertainty may test the key $60,000 support level and shape the broader narrative for digital assets in 2026.

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