The growth has been steady, with Bitcoin futures open interest finally showing signs of a comeback. It fall sharply when the entire cryptocurrency market crashed some -50 percent on March 12.
As skew (@skewdotcom) reports, Bitcoin futures open interest has been steadily moving upward since the end of March. The increase seems to be led by BitMEX and OKEx futures markets. It could be a sign that confidence is slowly returning to the cryptocurrency market.
Bitcoin futures open interest is timidly rebounding one month after the historic 40% one day sell-off pic.twitter.com/rMXs75Nves
— skew (@skewdotcom) April 13, 2020
Although an increase in open interest (OI) is not necessarily a bullish indicator, it is potentially a positive sign for the cryptocurrency market after a bloody March. The rebound seems to mirror a similar one seen in mainstream U.S. financial markets.
Many trading indicators have been showing possible signs of recovery, thus far, in April. Regarding futures markets, both the Chicago Mercantile Exchange (CME) and Bakkt saw the largest daily volume jump in weeks, earlier this month.
However, the uptick in trading volume and open interest should cause us to pause. Bitcoin futures markets could merely be betting on bearish sentiments. Recently, BeInCrypto reported that traders were paying a premium 6.5 percent APR to short the market-leading cryptocurrency on futures markets.
Because of uncertain macroeconomic indicators, price predictions for Bitcoin’s halving have been mixed. Some maintain that miners may try to lock-in profits before their profitability drops; others predict that Bitcoin will close the year strong — perhaps even reaching a new all-time high.
At the time of writing, Bitcoin is moving upward but has still not recaptured the $7,000 price point. On April 12, it saw a significant sell-off that had some fearing that panic would return to the market. The first and foremost cryptocurrency has since partially recovered, but the short-term remains uncertain for BTC.