On-chain data shows the Bitcoin open interest is sharply rising, a sign that a long squeeze may be brewing in the crypto futures market.
Bitcoin Open Interest Has Observed Rise Recently, While Funding Rates Remain Positive
As pointed out by an analyst in a CryptoQuant post, the futures market may be heading towards a long squeeze in the near future.
The “open interest” is an indicator that measures the total amount of Bitcoin futures positions currently open on derivatives exchanges. It includes both long and short positions.
An increasing value of the metric suggests users are opening more positions right now. Such a trend can lead to higher volatility in the crypto’s price.
On the other hand, a lowing open interest can mean positions on exchanges are closing down. A rapid swing in the price can cause a mass liquidation, sharply taking the indicator’s value down.
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