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Data shows Bitcoin price drops days after BTC futures open interest hits $1B

Published 11/27/2020, 06:52 PM
Updated 11/27/2020, 08:40 PM
Data shows Bitcoin price drops days after BTC futures open interest hits $1B
BTC/USD
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There was a time when BitMEX derivatives exchange reigned sovereign over other exchanges, and the company effectively held a 50% market share until July 2019. For this reason, traders kept a close eye on every indicator connected to BitMEX, including its funding rate, open interest, and basis.

Open interest measures the total number of contracts held by market participants. As the figure rises higher, so does the potential size of liquidations. On Aug. 2, a $1,400 crash happened as $1 billion in futures contracts were forcefully closed due to insufficient margins.

Bitcoin price vs. BitMEX perpetual open interest, USD. Source: TradingView
Aggregate Bitcoin futures open interest on Nov. 2019, USD. Source: Skew
Aggregate Bitcoin futures open interest, USD. Source: Skew

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