Crypto Market Hits $3 Trillion Amid Bitcoin Surge and Rising Leverage
Bitcoin's impressive rally has lifted the crypto market to its highest value since January, exceeding $3 trillion in total market capitalization. This resurgence follows a significant increase of over $740 billion in value since the U.S. Treasury announced plans to boost buybacks of long-term bonds.
The rise in prices has been accompanied by an increase in leveraged bets in perpetual futures, with open interest reaching nearly $160 billion, its highest level since late October last year. This surge in leverage raises concerns about sharp price swings and potential losses for traders.
Monday saw a significant liquidation of bearish bets, totaling over $920 million, as the price surged. The resulting closing of short positions could trigger a squeeze, causing additional upward pressure on prices. However, open interest continued to rise, indicating that new leveraged positions were entering the market.