Even as BTC faces selling pressure, demand for Bitcoin futures rises — what’s driving it?
BTC Falls to $109K as Dormant Whale Dumps for ETH
On August 25, Bitcoin (BTC) briefly dropped to $109,400, hitting a six-week low.
This correction was linked to a massive $11 billion BTC sell-off by a whale dormant for five years, reportedly rotating the funds into Ethereum (ETH).
Despite weakening market sentiment, Bitcoin futures open interest (OI) surged to an all-time high of 762,700 BTC, up 13% from two weeks ago, indicating strong demand for leverage.
Does Rising Futures Activity Signal Bullishness? Not So Fast
While increasing OI usually indicates an active market, it doesn’t automatically signal bullishness:
• Futures contracts are zero-sum: every long has a matching short, so a rise in OI means more participation, not necessarily optimism.
• If the market is overly long and BTC drops below $110,000, it could trigger cascading liquidations, rapidly accelerating the downtrend.
Currently, Bitcoin’s annualized futures premium sits at 8%, up from 6% last week, but still below the 10% “optimism threshold” for six consecutive months—even when BTC hit its $124,176 ATH.
Did the Whale Trigger Liquidations on Purpose?
According to CoinGlass data, the August 25 drop wiped out over $1 billion in long positions. This suggests deep liquidity—even on weekends.
However, the timing and speed of the whale’s dump raised eyebrows, as the seller had held the BTC for years. The incident affected both centralized exchanges and decentralized platforms like Hyperliquid.
ETF Outflows Continue, Funding Rates Retreat
• Bitcoin perpetual futures funding rate dropped back to 11%, within the neutral range of 8–12%, indicating a market in wait-and-see mode.
• U.S.-listed spot Bitcoin ETFs saw over $1.2 billion in outflows between August 15 and last Friday, reflecting declining risk appetite.
These trends point to growing market caution, especially in the options space.
Options Market: 10% Put Premium Shows Bearish Tilt
Currently, BTC put options are trading at a 10% premium over calls, indicating investors are hedging for further downside.
While such fear often follows steep drops (e.g., $6,050 in two days), it also reflects whales reallocating from BTC to ETH—flows that may stabilize over time.
Short-Term Uncertainty, Long-Term Hopes for $120K Remain
Despite near-term weakness, hopes for a rally toward $120,000 are still alive.
Bitfinex analysts emphasized that the key lies in the resumption of spot ETF inflows, especially amid global economic uncertainty.
Conclusion: Focus on Signals, Not Noise
While BTC faces short-term pressure, the record-high leverage and futures activity suggest that the market is still very much in play.
The next move hinges on:
• Whether ETF capital returns
• If whale capital rotation stabilizes
• And whether Fed policy or macro shifts alter market direction
Until then, staying cautious and avoiding excessive leverage might be the smartest strategy.
Source: [here]
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