Bitcoin Open Interest Drops 12% in 24 Hours as Traders Cut Risk

Bitcoin's pullback is being driven by deleveraging in derivatives markets rather than a buildup of fresh short positions, according to on-chain analyst Axel Adler Jr.

In a newsletter on July 13, Adler wrote that Bitcoin open interest fell 12% over the past 24 hours, while the pressure index slipped below its 30-day average. That suggests the move reflects deleveraging, not new short bets.

Bitcoin was down 1.9% over the past 24 hours, trading near $62,800. Adler said the more meaningful shift was in derivatives, not the spot market.

The pressure index for Bitcoin perpetual futures fell about 11 points over the past six hours to 46, according to Adler. The gauge had been in a 57-to-61 range a day earlier, but has now dropped below 50 and fallen under its 30-day average of about 58.

A reading below 50 means overall buying pressure has weakened. A move back above 58 would be the first sign of a recovery, Adler wrote.

Open interest declined in 21 of the past 24 hours. The total drop was about 12%, with the steepest hourly declines at 1.7% and 1.4%.

Adler said Bitcoin is now moving through a phase of lower leverage as positions are liquidated or closed during the price decline. If open interest were rising while the price fell, that would point to fresh short positions entering the market. The current pattern shows otherwise.

The move is closer to deleveraging and softer demand than to a structural breakdown or a new wave of short positions, Adler wrote. The market backdrop is neutral, but tilted toward risk aversion.