Bitcoin Futures Open Interest Hits $19 Billion, Harsh Intraday Swings, Analyst Says 'Fresh Rally' Expected

The start of the week saw digital currency markets drop significantly in value, as billions of dollars were shaved off the entire crypto economy’s capitalization. A weekly report from Luno and Arcane Research shows February 23 captured the third-largest bitcoin daily trade volume in crypto history, as spot market volume saw $18 billion change hands. Moreover, crypto derivatives are surging as bitcoin futures open interest commandeered $19.1 billion on Tuesday.

Volatile Bitcoin Price Fluctuations Sees Intraday Swings Close to 20% for Two Days In a Row

After bitcoin (BTC) touched an all-time price high on Sunday, hitting $58,354 per unit, bitcoin’s value slipped below the $50k handle touching bottom at $44,846 per coin. The loss between these two price ranges saw over 23% shaved off BTC’s market valuation.

While heavy losses were seen across the board throughout the entire crypto-economy, a report from Luno and Arcane Research shows that Tuesday’s trade volume was the third-largest ever seen. The digital asset’s intraday moves had shown the crypto asset’s price fluctuations have been more erratic. In fact, Luno’s report shows intraday moves of close to 20% happened two days in a row.

Bitcoin Futures Open Interest Hits $19 Billion, Harsh Intraday Swings, Analyst Says 'Fresh Rally' Expected

“The beginning of the week has been more volatile than usual, with both Monday and Tuesday seeing intraday moves of 18%,†the study notes. “Bitcoin dropped from $57k to $46k yesterday before recovering to $54k. This volatility continued this morning, as BTC dropped from the opening around $54k and all the way down to $45k. This is not reflected in the daily volatility metrics yet, as they’re based on daily close prices,†the report adds.

Bitcoin Futures Open Interest Hits $19 Billion, Harsh Intraday Swings, Analyst Says 'Fresh Rally' Expected

Luno’s report says that traders should be “very careful with leveraged positions, both longs and shorts.†It also said that bitcoin derivatives have been “snowballing in the bitcoin market†and had “peaked at $19.1 billion this Sunday.†“Yesterday’s sell-off pulled out some steam from the leveraged futures market, but the climate is still hot,†Luno’s study emphasizes.

Bull Market Could See a ‘Stronger Rally,’ Cooling Down the Feverish Derivatives Markets

Pankaj Balani, CEO of Delta Exchange, a digital asset derivatives trading platform says the recent bitcoin (BTC) correction was healthy.

“Despite the correction,†Balani said in a note to investors. “The bull market and the case for a stronger rally in bitcoin remains intact. This is only the second correction in BTC prices since November, when bitcoin broke above its previous ATH and started a fresh rally. The 2017 bull market saw bitcoin correct 25%-35% multiple times before reaching its peak in January of 2018,†the Delta Exchange added. Balani expects a “short-term consolidation†in BTC’s prices for now.

The findings in Luno and Arcane Research show that between February 1 to Feb. 22nd, bitcoin futures open interest (OI) climbed by 63% outpacing BTC’s price rise which was only 57%.

“The open interest outpacing the bitcoin performance should be a concerning sign as it shows that the leverage $10 [billion] is picking up,†Luno said. “While the OI is a result of both longs and shorts, the huge premiums in the futures market lately indicate that leveraged upside exposure has $5b been the main contributor to the rising OI. It would be a healthy sign going forward if the futures market’s growth takes a breather,†the report added.

The dramatic BTC derivatives fever has seemingly cooled down as Luno and Arcane’s findings show some of the futures OI had dissipated following the sell-off.

“The funding rates have returned to neutral territory, and the market seems healthier,†Arcane Research’s weekly note to investors said this week. For now, bitcoin traders are changing positions and strategies after the dump, and focusing on BTC’s next big move.

What do you think about bitcoin spot market volumes rising and the feverish bitcoin derivatives markets? Let us know what you think about this subject in the comments section below.

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

Du lịch nhật bản, hướng dẫn du lịch Nhật và đánh giá địa điểm Nhật Bản Japan travel news, japan travel guides, japan holiday destinations and japan reviews

RELATED NEWS

Concordium Debuts its Business-Oriented Blockchain Mainnet

After years of development, Concordium has unveiled its permissionless blockchain and MVP that is designed to meet the needs of enterprises by delivering transparency and governance, all with an orientation towards protecting user privacy. Identity-Centric Network to Promote Broader Business Adoption Although blockchain’s novel characteristics are not in dispute, corporate adoption of distributed ledger technology […]

Xem chi tiết: Concordium Debuts its Business-Oriented Blockchain Mainnet

Doge in Brooklyn: A Local Apparel Store Starts Accepting the Famed Crypto

On the heels of the SpaceX announcement that the company accepted dogecoin as payment, an apparel store on Brooklyn’s colorful Flatbush Avenue took the jump as well into the deep, cold Doge waters. Brick-and-Mortar Is Another Brick in the Crypto Adoption Wall Crypto adoption has been widely and thoroughly discussed in the media and on […]

Xem chi tiết: Doge in Brooklyn: A Local Apparel Store Starts Accepting the Famed Crypto

Iran’s President Wants Crypto ‘Laws and Instructions’ Implemented as Soon as Possible

Iranian president Hassan Rouhani discussed cryptocurrencies at the most recent meeting of the government’s Economic Coordination Board and told participants that regulatory policy is needed to protect consumers. Rouhani believes the Iranian government should “communicate the necessary laws and instructions†as soon as possible so dishonorable crypto businesses are avoided. Regulation Necessary to Keep ‘Unprofessional’ […]

Xem chi tiết: Iran’s President Wants Crypto ‘Laws and Instructions’ Implemented as Soon as Possible

South African Court Submissions Expose Lies and Deceptive Tactics Used to Perpetuate MTI Bitcoin Ponzi Scheme

New submissions by a South African regulator, the Financial Sector Conduct Authority (FSCA) and liquidators have exposed the web of lies and deceptive tactics that were used by Mirror Trading International (MTI) CEO Johann Steynberg and others to perpetuate the Ponzi scheme. Undeclared Losses In its report filed with the South African court, the regulator […]

Xem chi tiết: South African Court Submissions Expose Lies and Deceptive Tactics Used to Perpetuate MTI Bitcoin Ponzi Scheme

Denmark to Revise Tax Law to Target Cryptocurrencies

The Danish tax ministry is reportedly mulling over revising the country’s tax law to deal with the challenges posed by cryptocurrencies. Denmark’s tax authority is concerned about the rising risk of fraud and widespread filing errors involving cryptocurrencies. Denmark to Revamp Tax Law to Deal With Cryptocurrency Denmark is considering revamping its tax code in […]

Xem chi tiết: Denmark to Revise Tax Law to Target Cryptocurrencies

Report: Document Shows Specific Bitcoin Miners in Xinjiang Instructed to Shut Down

An official notice stemming from the Changji prefecture government in Xinjiang details that officials from the Zhundong Economic-Technological Development Park must instruct bitcoin miners to shut down. China’s province of Xinjiang is a highly concentrated region of bitcoin miners and bitcoin activities at the park must cease by June 9, according to the document. Nevertheless, […]

Xem chi tiết: Report: Document Shows Specific Bitcoin Miners in Xinjiang Instructed to Shut Down

$160 Billion Asset Manager Entering Crypto Market in Collaboration With Nasdaq

An asset management firm with nearly $160 billion in assets under management, Victory Capital, has announced that it is entering the cryptocurrency market. The firm has established exclusive agreements with Nasdaq and asset manager Hashdex. Asset Management Firm Entering Crypto Market Victory Capital Holdings Inc. (Nasdaq: VCTR) unveiled its plans to enter the cryptocurrency market […]

Xem chi tiết: $160 Billion Asset Manager Entering Crypto Market in Collaboration With Nasdaq

Coinbase Says Interest From Pension Funds and Hedge Funds Has Skyrocketed, Institutional Holdings Soar 170%

The Nasdaq-listed cryptocurrency exchange Coinbase has revealed record growth in its institutional business. “This year, interest from pension funds and hedge funds has skyrocketed, supported by the roll-out of crypto-ETPs as well as an increased understanding of the crypto economy,†said Coinbase. Coinbase Sees Interest From Institutional Investors Skyrocketing Cryptocurrency exchange Coinbase (Nasdaq: COIN) reportedly […]

Xem chi tiết: Coinbase Says Interest From Pension Funds and Hedge Funds Has Skyrocketed, Institutional Holdings Soar 170%

Hong Kong to Connect Digital Yuan With Domestic Payments System in Cross-Border Trials

Mystery Whale Returns by Moving $35 Million — Miner Transfers 1,000 ‘Sleeping Bitcoins’ from 2010

The First DeFi & NFT Social Media Project, Torum Announces NFT Launchpad

Uganda Museum Collaborates With Software Development Firm to Create NFTs for Display on Binance Marketplace

Warren Buffett’s Berkshire Hathaway Invests in Bitcoin-Friendly Digital Bank

Commodity Strategist Mike McGlone Says $40K BTC Target ‘More Likely’ Than $20K

Crypto Payments App Bottlepay Is Now Available Across Europe

Elon Musk Agrees With Vitalik Buterin on Dogecoin and Ethereum Collaboration