Bitcoin Open Interest Down 30% Since October Amid Deleveraging

TLDR

Table of Contents

Bitcoin open interest has dropped 30% since October 2025’s $15 billion peak.
Spot-driven gains suggest reduced reliance on leveraged long trades.
Most Bitcoin options open interest is at the $100,000 strike on Deribit.
Open interest is down to $65 billion from $90 billion in October 2025.

Bitcoin’s derivatives market has seen a major reset, with open interest dropping by 30% since its October 2025 peak. This large decline signals a widespread reduction in leveraged trading, which analysts say has often come before market bottoms. As excess leverage exits the system, Bitcoin’s recent recovery appears to be fueled more by spot buying than speculation — a trend that could support more stable price growth in the near term.

Deleveraging Lowers Risk and Resets Market Structure

Bitcoin’s derivatives market has experienced a sharp decline in open interest, falling 30% since its October 2025 peak. According to data from CryptoQuant, this drop signals a widespread reduction in leveraged trading positions.

Analysts state that such reductions have historically marked periods of market bottoming. CryptoQuant analyst Darkfost noted, “Historically, these periods have marked bottoms.” The removal of excess leverage may reduce volatility and help restore a more stable market foundation.

Open interest reflects the number of outstanding contracts in Bitcoin futures and options. A sharp decrease usually shows that traders are closing positions, facing liquidations, or reducing speculation. These shifts can reduce the likelihood of rapid price drops caused by forced selling.

Leverage Unwind Follows Highs in 2025

During the 2025 rally, Bitcoin open interest peaked at $15 billion on October 6. This was nearly three times higher than the previous record of $5.7 billion on Binance in November 2021.

This surge was linked to heavy use of leverage by traders. Since then, that buildup has been gradually reversed. The unwinding of these positions is seen as part of a healthy reset after the market’s volatile expansion last year.

CryptoQuant highlighted how a similar dynamic occurred during the October 10 event, when excessive leverage led to sharp downside moves and liquidations across platforms.

Spot Demand Drives Recent Price Gains

Bitcoin’s recent upward movement has been supported by spot market buying rather than new leveraged long positions. This pattern is often interpreted as more stable and less prone to quick reversals.

CryptoQuant mentioned that Bitcoin has gained about 10% year-to-date. This gain came while open interest continued falling, indicating that short sellers were likely covering positions rather than traders opening large new bets.

When prices rise as open interest falls, it often reflects sellers being forced to exit rather than new buyers taking on leverage. This may help sustain price recoveries by limiting the risk of sudden drops caused by overextended trades.

Derivatives Market Shows Mixed Signals

Although leverage is declining, full bullish sentiment in derivatives markets has not yet returned. Current open interest stands at about $65 billion, down from over $90 billion in early October, according to CoinGlass.

Deribit, a major crypto options exchange, shows the largest amount of Bitcoin options interest at the $100,000 strike. This total is valued at about $2.2 billion, suggesting that traders expect prices to move higher.

Yet, analytics firm Greeks Live said recent activity still appears short-term in nature. “The current trading structure looks more like a response to a sudden surge,” the firm stated, noting that long-term positioning remains uncertain.