Key facts
- Crypto-margined Bitcoin futures now account for approximately 12% of total open interest.
- This represents a substantial decline from nearly 100% in 2019-2020.
- Traders are increasingly using stablecoins as collateral for Bitcoin futures.
- Over the past 24 hours, $570.08 million in Bitcoin positions were liquidated.
- Short positions experienced greater liquidations than long positions.
Bitcoin futures traders have largely shifted away from using Bitcoin as collateral, with crypto-margined positions now making up only about 12% of open interest across exchanges, down from nearly 100% in 2019-2020. This trend indicates a preference for stablecoin collateral, which offers more stable value during trade swings and avoids the feedback loop of price drops triggering margin calls.
Despite this structural shift, Bitcoin experienced a significant short squeeze in the past 24 hours, with $570.08 million in positions liquidated. Short positions were hit harder, totaling $329.60 million compared to $240.48 million in long liquidations. Bitcoin itself saw $295.41 million in liquidations, with a single $103.54 million BTC position on Bitget being the largest single liquidation.
Bitcoin's price rebounded from around $57,000 to a weekly close near $79,175, showing a 1.88% increase today. This price action occurred after a period of low volatility between $60,000 and $68,000. The move towards stablecoin margins mirrors the maturation of the broader derivatives market, with institutional flows tending to settle in dollars. However, the article notes that leverage remains leverage regardless of collateral, and the current squeeze may not be over.