Bitcoin
Bitcoin Open Interest Hits Record Levels: Could $80K Be Next?
- The coin’s open interest has reached the highest point since March, suggesting BTC could surpass $73,750.
- Foreign exchange withdrawals increased while the funding rate was positive, reinforcing the upward bias.
For the first time since reaching its all-time high of $73,570, Bitcoin [BTC] Open interest reached a new record. Specifically, open interest was $37.66 billion, according to Glassnode data.
Open Interest (OI) is the value of open contracts in the derivatives market. If the OI decreases, it means that traders are closing more and more of their positions, and this could lead to a price drop.
However, a rise in OI like Bitcoin did recently is a sign that new money is entering the market. If sustained, this could support BTC’s uptrend and lead to a higher price.
Source: Glassnode
BTC aims higher, supported by exchange flow
At the time of writing, BTC changed hands at $71,200. This represented a jump of 3.89% in the last seven days. As interest in the token increases, there is a high chance that it could overcome its all-time high and will possibly reach $80,000.
Despite the optimistic forecast, it is important to watch spot trading activity on exchanges as this can also affect price movement.
One of the ways to do this is to look at the supply on exchanges and the supply outside of them. Additionally, the balance of some major exchanges can give you an idea.
For example, AMBCrypto found that historical balances on Binance and Coinbase dropped, indicating that users were withdrawing their BTC from the platforms. However, Kraken recorded an increase in BTC shopping on May 30, before the recent decline.
It appeared that many holders were buying more coins on exchanges and withdrawing them over the long term. If this continues to be the case, Bitcoin could escape selling pressure and the price could reach an all-time high before the end of June.
Source: Santíment
Traders continue to bet on the rise
On the other hand, the forecast could be invalidated if the supply on the exchanges starts to increase. This is because an increase in supply would mean that investors would be willing to book profits. If this happens, BTC could lose $70,000.
However, traders do not seem to share the point of view of reducing prices. This was based on Funding Rate data obtained from Coinglass.
According to the derivatives information portal, Bitcoin Financing rate was positive. If the metric reading is negative, it implies that shorts are paying a fee to longs to keep their position open.
In this case, the broader sentiment is bearish.
Source: Coinglass
To read Bitcoins [BTC] Price prediction 2024-2025
However, the positive reading of the metric indicated that longs are dominant and expect BTC price to rise. Bitcoin should rise to $74,000 while being talked abouttraders with long positions would be rewarded.
This could also give way to $80,000 as long as the bears fail to destroy the uptrend.