Bitcoin's Q3 Rally Distinct from Previous Ones: Lower Open Interest and Spot ETF Demand
Bitcoin's third quarter has been one of its strongest in years, with a gain of nearly 42% as of September 30. This puts it on track for its best quarterly performance since Q4 2024, when it rose 47%. The current rally is distinct from previous ones, as Bitcoin open interest has fallen roughly 20% from earlier September levels.
Total open interest for Bitcoin declined to about $21.14 billion on Wednesday, according to data from Santiment. This decrease in derivatives positioning suggests that traders have been reducing leveraged exposure even as prices climbed. Despite this, the price of BTC has still risen in September.
The demand for spot Bitcoin ETFs has also been strong, with an inflow of $2.4 billion in the week ending Sept. 25. This is the highest amount since October 2025, and it has turned the funds' 2026 flows positive. SoSoValue estimates that they are now at about $934.1 million for the year.
Some analysts believe that fresh institutional allocation could be the next catalyst for Bitcoin's move into Q4. Fundstrat's Tom Lee said that only around 2% of institutions in his universe have an allocation, and he predicts a 'big rotation' in the fourth quarter.