ChainThink reports that, as of August 25, market data shows Bitcoin recently surged rapidly from around $62,000 to near $80,000, marking the second-largest weekly gain in nearly five years.
However, during this rally, the open interest (OI) of Bitcoin-denominated futures has continued to decline, falling to approximately 587,600 BTC, a five-month low.
According to Glassnode data, the rally was primarily driven by short covering and liquidations, with billions of dollars in short positions being liquidated during this period, creating a short squeeze. The annualized funding rate for perpetual contracts remains below 10%, indicating that leverage is not overly crowded.
Additionally, crypto margin futures open interest has fallen to a historic low of approximately 52,000 BTC, accounting for only 11% of the overall market. The increased share of cash collateral helps reduce the chain risk of “collateral erosion—liquidations—further price declines” during downward price movements.
Lower participation in the derivatives market and healthier leverage structures may indicate that this rally has greater sustainability.