Bitcoin's open interest has fallen to its lowest level in seven months, noted alongside a recent BTC price increase. Let's explore its impact on the market and future price movements.
Decline in Open Interest Over Seven Months
As of March 5, total BTC futures open interest is 559,480 BTC, worth $50.02 billion across all exchanges. While OI increased 6.65% over the past 24 hours, the trend has been downward for months. CME exchange leads with 142,680 BTC, worth $12.73 billion in open interest, accounting for 25.46% of the market. The largest cryptocurrency exchange, Binance, follows with 106,120 BTC, or $9.49 billion, representing 18.96% of total BTC futures OI. The drop in open interest indicates traders have reduced leverage, likely due to recent Bitcoin volatility.
Bitcoin Price Rally and Its Drivers
Bitcoin’s price rebounded strongly, climbing nearly 6% within 24 hours. Investors are watching to see if the BTC price will flip the $90,000 level as support. The decline in open interest over recent months suggests this price action is driven more by spot buying rather than speculative positions, making the rally more stable. While retail activity is mild, institutional traders remain active, and their actions will influence Bitcoin's future course.
Price Impact: National Reserve and Institutional Investors
Discussion around President Trump's national crypto reserve plans could influence this rally. Since his inauguration, his stance on Bitcoin has sparked interest in potential government adoption, driving corporate interest in Bitcoin. Figures like Michael Saylor have been invited to the White House Summit on March 7. President Trump mentioned that his executive order on digital assets would establish a cryptocurrency stockpile. This national reserve could drive a Bitcoin breakout in the coming weeks.
The market impact of reduced open interest and a potential national crypto reserve remains unclear. The coming days will reveal if these factors lead to sustained growth or new volatility.
