Bitcoin Open Interest Surges to 19-Month High

The Bitcoin open interest can frequently predict the future direction of the Bitcoin price, contingent on whether the metric is ascending or descending.

Bitcoin open interest has increased significantly, attaining levels not seen in the past 19 months.

Particularly since investors continue to be extremely bullish, it is possible to extrapolate what this implies for cryptocurrency’s price using historical data.

An intriguing development has been the rapid increase in Bitcoin open interest on numerous exchanges.

This metric increased by a cumulative 7.89% in the preceding twenty-four hours across all exchanges in the space, bringing the total open interest to an astounding $17.04 billion, or 454,150 BTC.

Most Bitcoin open interest is concentrated on the CME, ByBit, and Binance exchanges. However, perhaps even more intriguing is the fact that these levels of open interest represent the highest point in 19 months.

Based on the information provided on the CoinGlass website, the previous instance in which the Bitcoin open interest exhibited such behavior and reached its peak was in March 2022, before the momentous Terra LUNA collapse instigated an extended period of bearish sentiment for the market.

This indicates that the last time Bitcoin open interest increased by this magnitude, it was when the bull market still enthralled investors.

Consequently, the historical performance of the Bitcoin price in terms of open interest at that time could provide insight into the future price movement of the digital asset.

A month ago, the Bitcoin open interest increased from approximately 38,000 BTC to over 44,000 BTC, mirroring the current trend; the BTC price followed suit.

As a result of this pattern, the cost increased from $38,700 to over $47,000 by the end of March 2022.

Based on Bitcoin’s past performance and assuming the current trend continues, the rally could continue.

Similarly, the price of Bitcoin is currently $37,500, and a comparable surge could propel it to $45,000 by the end of the month.

Nevertheless, the open interest can reach its zenith at this level before starting to decrease. The BTC price may begin declining as open interest falls, similar to what occurred in April 2022. A comparable downturn would cause the price to hover around $27,000.