Bitcoin open interest matches record high amid predictions of BTC price ‘fireworks’ this month

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Bitcoin (BTC) is set to be “explosive” on prices as derivatives markets resume their shape in 2022, according to a new forecast.

In one Tweeter On January 4, Vetle Lunde, analyst at Arcane Research, confirmed that open interest (OI) denominated in BTC had returned to record levels in November.

Open interest demands “fireworks” in a few weeks

Bitcoin futures and options took a hit during the year-end BTC / USD retracement, but as the holiday season ended, consensus began to form around a major comeback.

Institutional traders are expected to become the major force in Bitcoin markets, some say, and derivatives are already showing signs of such renewed interest.

OI is now back to levels it last reached in the third week of November, when BTC / USD itself hit all-time highs of $ 69,000.

In contrast to that, however, funding rates are currently neutral – a key basis for forming a volatile move.

“Open interest denominated in BTC in perpetual BTC has passed November highs today as leverage accumulates on neutral to slightly below neutral funding rates. It seems explosive,” commented One of.

Annotated graph of BTC OI funding rate vs. Binance. Source: Vetle Lunde / Twitter

Lunde is not alone. In a separate article published on Monday, Filbfilb, co-founder of the Decentrader trading platform, also noted the encouraging activity of the OI state.

“Very high OI relative to market cap. I doubt we will see it beyond the last week of this month without fireworks,” he said. wrote.

Ethereum hits its first peak of 2022

Data Cointelegraph Markets Pro and TradingView showed BTC / USD was trading near $ 47,380 at the time of writing on Tuesday, recovering from a decline that took the pair to a two-week low.

Related: Bitcoin Exchange Balances Trend To Return To All-Time Lows As BTC Withdrawals Resume In January

While analysts were overall calm When it comes to action on short time frames, it’s always the altcoins that are the main point of interest.

“The point of maximum financial opportunity for altcoins is always present,” said Michaël van de Poppe, contributor to Cointelegraph. argued, reiterating previous convictions on the opportunities presented by alternative markets.

1 hour BTC / USD candle chart (Bitstamp). Source: TradingView

Ether (ETH), the largest altcoin by market cap, hit $ 3,879 on that day, its best performance of 2022 to date.

1 hour ETH / USD candle chart (Bitstamp). Source: TradingView