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Breaking News: Major Win For Memecoins: SEC Affirms They Typically Do Not Qualify As Securities

Solana, Ethereum Attract Traders Amid Bitcoin Open Interest Plunge

Keshav Verma
Keshav Verma
8 months ago
2 mins read
Solana

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Este artículo también está disponible en español.

Data shows that Bitcoin (BTC) Open Interest plummeted during the latest market retrace, but Solana (SOL) and Ethereum (ETH) have been resilient.

Solana & Ethereum Open Interest Has Only Seen A Mild Retrace

According to data from the analytics firm Santiment, Bitcoin has seen its Open Interest plunge after the pullback in its price. The “Open Interest” here refers to a metric that keeps track of the total amount of derivatives positions related to a given asset (in USD) currently open on all exchanges.

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When the value of this metric goes up, investors will be opening new positions in the derivatives market right now. As new positions generally suggest a rise of total leverage in the market, the Open Interest registering this trend can lead to more volatility for the cryptocurrency’s price.

On the other hand, the indicator observing a decline implies some investors are either closing up their positions of their own volition or getting forcibly liquidated by their platform. The asset tends to behave more stably once such a decrease goes through.

Now, here is a chart that shows the trend in the Open Interest for three top coins in the sector, Bitcoin, Ethereum, and Solana, over the past month:

Bitcoin, Solana, and Ethereum Open Interest
The value of the metric appears to have gone down for BTC in recent days | Source: Santiment on X

As displayed in the above graph, the Bitcoin Open Interest has dropped around 7.5% in the past day. The reason behind this plunge will likely be the asset’s retrace to levels under $63,000.

Interestingly, while Ethereum and Solana have registered similar price drawdowns inside this window, the Open Interest is only down around 2% for both of them.

It’s possible that Bitcoin was simply the most leveraged of these assets, so the relatively small price drop was enough to cause significant liquidations. There are also some other possibilities, however.

The investors may be more interested in the altcoins right now, choosing to close down BTC-related positions and opening up more positions related to alts like Solana and Ethereum.

It’s hard to say whether this increased appetite for speculation around Solana and Ethereum relative to Bitcoin is a positive for the market. Still, it does set these coins up to see some action shortly.

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On the topic of liquidations, data from CoinGlass has revealed the exact figures related to the Open Interest flush the cryptocurrency sector has witnessed in the last 24 hours.

Bitcoin, Solana, Ethereum Liquidations
A large number of liquidations appear to have occurred during this period | Source: CoinGlass

The table shows that $107 million in cryptocurrency derivatives contracts have found liquidation during the past day, with over $88 million of these coming from the long contract holders alone.

SOL Price

At the time of writing, Solana is trading around $156, up almost 7% over the past week.

Solana Price Chart
Looks like the price of the coin has been moving sideways over the last few days | Source: SOLUSD on TradingView
Featured image from Shutterstock.com, CoinGlass.com, Santiment.net, chart from TradingView.com
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Keshav Verma
Keshav Verma

Keshav Verma

Keshav is currently a senior writer at NewsBTC and has been attached to the website since June 14, 2021.

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Keshav has been writing for many years, first as a hobbyist and later as a freelancer. He has experience working in a variety of niches, even fiction at one point, but the cryptocurrency industry has been the longest he has been attached to.

In terms of official educational qualifications, Keshav holds a bachelor’s degree in Physics from one of the premier institutes of India, the University of Delhi (DU). He started the degree with an aim of eventually making a career in Physics, but the onset of COVID led to a shift in plans. The virus meant that the college classes had to be delivered in the online-mode and with it came free time for him to explore other passions.

Initially only seeking to make some beer money, Keshav unexpectedly landed clients offering real projects, after which there was no looking back. Writing was something he had always enjoyed and to be able to do it for a living was like a dream come true.

Keshav completed his Physics degree in 2022 and has been focusing on his writing career since, but that doesn’t mean his passion for Physics has ended. He eventually plans to re-enter university to obtain a masters degree in the same field, but perhaps only to satiate his own interest rather than for using it as a means to find employment..

Keshav has found blockchain and its concepts fascinating ever since he started going down the rabbit-hole back in 2020. On-chain analysis in particular has been something he likes to research more about, which is why his NewsBTC pieces tend to involve it in some form.

Being of the science background, Keshav likes if concepts are clear and consistent, so he generally explains the indicators he talks about in a bit of detail so that the readers can perhaps come out having understood and learnt something new.

As for hobbies, Keshav is super into football, anime, and videogames. He enjoys football not only as a watcher, but also as a player. For games, Keshav generally tends towards enjoying singleplayer adventures, with EA FC (formerly FIFA) being the only online game he is active in. Though, perhaps due to being ultra-focused on the game, he is today a semi-pro on the EA FC scene, regularly participating in tournaments and sometimes even taking back prize money.

Because of his enthusiasm for anime and games, he also self-learned Japanese along the way to consume some of the untranslated gems out there. The skill didn’t merely remain as just a hobby, either, as he put it to productive use during his exploration for small-time gigs at the start of COVID, fulfilling a couple of Japanese-to-English translation jobs.

Keshav is also big into fitness, with agility and acceleration-related workouts making a big part of his program due to the relevance they have in football. On top of that, he also has a more traditional strength based program for the gym, which he does to maintain an overall fitness level of his body.

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Disclaimer: The information found on NewsBTC is for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.

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Reason to trust

Strict editorial policy that focuses on accuracy, relevance, and impartiality
Created by industry experts and meticulously reviewed
The highest standards in reporting and publishing
How Our News is Made

Strict editorial policy that focuses on accuracy, relevance, and impartiality

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Morbi pretium leo et nisl aliquam mollis. Quisque arcu lorem, ultricies quis pellentesque nec, ullamcorper eu odio.

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