The recent surge in Bitcoin ( BTC ) open futures contracts has analysts concerned that the market might be showing signs of frothiness.
“BTC open interest (OI) has surged, exceeding $35 billion, a level that has historically correlated with local price peaks,” Bitfinex analysts declared in an Oct. 1 report .
Bitcoin OI — the total number of Bitcoin futures contracts that have yet to be settled or expire — is a critical metric investors use to assess market sentiment and anticipate future price movements.
On Sept. 27, Bitcoin OI reached $35.52 billion, the highest since June 7 when it clocked $37.69 billion, according to CoinGlass data . At that time, Bitcoin was trading near its all-time high, at $70,759, before pulling back nearly 18% over the next 30 days to $58,239.
The analysts argues that this “raises concerns of potential market overheating.”
Since Sept. 27, Bitcoin’s open interest has dropped about 9% to $32.32 billion, and the BTC price has also fallen toward $60K amid escalating tensions in the Middle East.
At the time of publication, Bitcoin is trading at $61,629, down 4.36% over the past seven days, according to TradingView data .
The pullback is within a range that Bitfinex analysts believe won’t derail the bullish momentum.
“A modest 5-10 percent pullback could reset OI without disrupting the overall uptrend,” they opined.
