Open interest (OI) on Bitcoinfutures contracts, representing derivatives contracts that have not been closed at a specific time, has reached a staggering $14 billion. Data collected from various derivatives trading platforms shows that Bitcoin OI has surged significantly, and the current level exceeds any level this year.
Leading the way in Bitcoin open interest is the largest cryptocurrency exchange, Binance, with around 32% of total open interest.
However, Binance’s share is well below the 50% mark and is almost half of the share held by the Chicago Mercantile Exchange (CME). CME is a well-known participant in the financial market, holding only 18% of the total open interest in Bitcoin.
Another popular cryptocurrency exchange, Bybit, holds the third-largest share of Bitcoin OI, slightly behind Binance. Despite its smaller share, Bybit is still a significant player in the market, contributing to the overall growth of Bitcoin futures contracts.
It is worth noting that the surge in Bitcoin OI has been evident in recent weeks. As of March 18 this year, the figure continued to exceed $10 billion, but did not see a significant increase until June 16. A similar surge was seen between April 5 and 14; however, open interest only peaked at $13 billion during this period.
To find when Bitcoin open interest crossed the $14 billion mark, one has to go back to May 2022. Therefore, the current level represents the top for 2023.
The increase in Bitcoin open interest reflects growing interest in Bitcoin futures and options. The growing confidence and willingness of market participants to participate in these derivatives contracts demonstrates their strong belief in the future value and potential of Bitcoin.
Industry experts speculate that several factors could be driving the surge in Bitcoin open interest. Recent regulatory clarity surrounding cryptocurrencies and growing acceptance of digital assets by institutional investors may have been contributing factors. Additionally, the overall maturity of the cryptocurrency market, coupled with the growing availability of derivatives products, has created a favorable environment for market participants to participate in Bitcoin futures contracts.