After hitting a new all-time high (ATH) of $124,474 on Binance on August 13, Bitcoin (BTC) has tumbled toward $113,000, with the next major support zone around $110,000. Analysts warn that more downside could still be ahead for the top cryptocurrency.<\/p>\n
According to a CryptoQuant Quicktake post by contributor XWIN Research Japan, Bitcoin open interest across all exchanges has surged past $40 billion, nearing ATH territory. This rise shows both whales and short-term traders are piling into leveraged positions.<\/p>\n
The chart below highlights the recent spike in BTC open interest, now hovering at $40.6 billion. Compared to August 2024 levels of $15 billion, open interest has grown by more than 150%.<\/p>\n
The CryptoQuant contributor added that despite this surge, the funding rate has remained positive, showing a strong long bias. While this reflects market optimism, it also signals a crowded trade, with most participants betting on further BTC appreciation.<\/p>\n
As a result, the risk of a long squeeze \u2013 forced liquidations of long positions due to aggressive leverage \u2013 has risen. XWIN Research Japan explained in their analysis:<\/p>\n
A sudden price drop can trigger a cascade of forced selling, amplifying volatility. In other words, Bitcoin\u2019s short-term moves remain at the mercy of speculative flows.<\/p>\n
Despite speculative froth from excessive leverage in the market, BTC fund holdings by Bitcoin exchange-traded funds (ETFs) and institutional investors continue to surge, exceeding 1.3 million according to latest data.<\/p>\n
Spot ETFs and corporate treasuries absorbing BTC provides the digital asset a structural bid that steadily reduces its available supply. According to data<\/a> from SoSoValue, US-based spot Bitcoin ETFs currently hold $146 billion in net assets \u2013 representing 6.47% of BTC\u2019s market cap.<\/p>\n That said, this week alone has seen more than $645 million in outflows<\/a> from spot Bitcoin ETFs, following two consecutive weeks of inflows totaling nearly $800 million. Among the ETFs, BlackRock\u2019s IBIT leads with $84.78 billion in net assets as of August 19.<\/p>\n Still, not all signals are bearish. For instance, while BTC slipped below $115,000, its spot trading volume surged<\/a> past $6 billion, giving bulls hope for a potential rebound.<\/p>\n