Bitcoin Surges to $86,500 Amid Rising Risk for Bullish Investors
Bitcoin has surged to $86,500, with investors betting on further gains taking on more risk if prices reverse, according to CoinDesk's analysis based on CoinGlass data.
The price climb from $83,500 to $86,500 since September 30 has been accompanied by a rise in open interest, which represents outstanding futures contracts. Open interest rose by 27,000 BTC in two days, from 626,000 BTC to about 653,000 BTC.
Total dollar value of positions reached $56.2 billion, indicating new positions are accompanying the move. The increase in funding costs points to stronger demand for bullish positions.
The recent increase in funding costs shows that investors are willing to pay more to maintain their bullish positions. However, if Bitcoin sees a sudden pullback, leveraged investors could face position-holding costs in addition to price losses.
The recovery began near one-year lows, with open interest standing at about 625,000 BTC at the end of September. The latest increase came from a low base after a prolonged period of weakness.