Analysis: Bitcoin Derivatives Market Ends 8-Month Deleveraging Cycle, Binance's Open Interest Returns Above the 180-Day Moving Average

May 22. Analyst Darkfost (@Darkfost_Coc) shared on social media that Bitcoin has been stuck in a prolonged deleveraging phase in its derivatives market since events unfolded last October 10. Historically, when open interest drops below the 180-day moving average, it signals a slump in futures activity—driven by investors cutting risk exposure, which pushes open interest lower. Pressured by worsening global macroeconomic conditions and geopolitical uncertainty, traders broadly opted to trim their risky positions. On crypto exchange Binance, this deleveraging stretch lasted roughly 8 months; the last comparable period was during the 2022 bear market, right before FTX’s collapse. That said, the trend shifted as of early May. Binance’s Bitcoin open interest climbed from around $6.4 billion in March to roughly $8.96 billion currently, reclaiming its ~$8.75 billion 180-day moving average. This marks the official end of the deleveraging cycle. The return of investors to Bitcoin’s derivatives space has fueled the recent upward rebound, though it’s still far too soon to declare a genuine market recovery. Notably, this momentum remains extremely fragile. Even with ongoing macro headwinds, Bitcoin’s sharp pullback drew in speculative traders betting on a rebound—yet if Bitcoin resumes the correction that began last October, these traders could exit just as quickly as they piled in.