Bitcoin's futures market just endured its sharpest deleveraging phase since 2023, with Binance open interest briefly dropping below its 180-day moving average in what CryptoQuant calls the largest liquidation event of the current cycle. Traders have already piled back in, pushing open interest higher again and helping fuel a price rebound.
Binance's Bitcoin futures market took a violent hit this week. CryptoQuant analyst Darkfost flagged what he called the sharpest deleveraging phase since 2023, with Binance's Bitcoin futures open interest briefly dropping below its 180-day moving average. The episode also earned a starker label: the largest liquidation event of Bitcoin's current market cycle.
Forced liquidations and an aggressive unwinding of leveraged positions drove the deleveraging.
Open interest still sits above its trend
Despite the sharp decline, Binance's Bitcoin open interest remains at $9.6 billion, above its 180-day moving average. That gap of $8.3 billion on the moving average shows how inflated positioning had become before the correction hit. Binance alone accounts for roughly 37% of total Bitcoin open interest across all exchanges.
Traders have already re-entered the market, though, pushing open interest back above the 180-day average and contributing to a price rebound. Current open-interest levels on Binance now exceed those seen during the May 2026 recovery, when Bitcoin surged back toward $82,000.
A pattern that keeps repeating
The current episode mirrors a longer deleveraging phase that played out over eight months, starting after open interest peaked in October 2025 and concluding around May 2026. During that stretch, Binance's BTC open interest bottomed near $6.4 billion in March 2026.
It then climbed to approximately $8.96 billion by May, crossing back above the 180-day moving average of around $8.75 billion at that time. That crossover coincided with the price recovery toward $82,000, which established the moving average as a meaningful signal for gauging sentiment in the derivatives market.
Why the flush could be constructive
For spot holders, deleveraging events can actually help. They clear out speculative excess and reset funding rates, often creating healthier conditions for sustained price gains. The May 2026 recovery makes the case: Bitcoin's rally to $82,000 came after months of gradual leverage reduction, not during a period of peak speculation.
Binance's dominance in Bitcoin derivatives adds another factor to watch. With 37% of total open interest concentrated on a single exchange, any disruption to Binance's operations, whether technical, regulatory, or otherwise, could amplify future deleveraging events across the broader market.
Source: Crypto Briefing
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