RECORD FUTURES MARKET INTEREST AS BITCOIN NEARS NEW HIGH 

The overall open interest (OI) in Bitcoin for futures and perpetual contracts across various decentralized exchanges (DEXs) saw a significant increase, reaching $41.8 billion last week.

The open interest in Bitcoin futures and perpetual contracts on centralized exchanges (CEXs) has reached new peaks, buoyed by Bitcoin’s consistent rally to prices unseen since November 2021.

Bitfinex’s recent weekly digest revealed that the OI for Bitcoin futures and perpetual pairs has climbed to $26 billion, eclipsing the former high of $24 billion recorded in the final quarter of 2021. This surge is indicative of escalating investor optimism for a rally preceding the halving event, potentially elevating BTC’s price to surpass its 2021 high of $69,000.

Rising Bitcoin Open Interest

Open interest in Bitcoin futures and perpetual contracts reflects the total value of all Bitcoin futures contracts that have not been settled. This indicator is crucial for understanding market sentiment and the level of investor participation in BTC.

An analysis from the crypto futures market data provider Coinalyze showed that the total Bitcoin OI across several decentralized exchanges (DEXs) also ascended to $41.8 billion last week. This upward trend in OI on both CEXs and DEXs, noticeable since January 2024, has been linked to the increasing price of BTC.

A significant 44% increase in Bitcoin’s price in February, along with its recent ascent to a new all-time high, has largely been fueled by investments into spot BTC exchange-traded funds (ETFs). These ETFs have amassed over 146,522 BTC, valued at more than $7.5 billion, in less than two months, surpassing all initial forecasts.

Initial expectations estimated the ETFs would attract $28 billion in their first year. Yet, the current pace of inflow places these financial products well ahead of predictions. With substantial investments anticipated from management advisors such as Morgan Stanley, Wells Fargo, and Bank of America, the ETF market is poised for considerable growth.

Emergence of Altcoin Season

Meanwhile, altcoins have been gaining momentum, hinting at the potential start of an altcoin season. This period is characterized by significant investment and speculative interest in cryptocurrencies other than BTC.

Bitfinex speculates that the crypto market might be entering an altcoin season, evidenced by a 50% increase in TOTAL3, an index excluding BTC and ether. The market capitalization of this index has significantly grown from its low of $450 billion during the bear market to $640 billion.

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