Bitcoin’s OI jumped $2.02 billion over three days, sparking concerns among traders about a potential “whipsaw” event.
Bitcoin’s (BTC) open interest (OI) surged over $2 billion in just three days, leading traders to believe it may trigger a sudden “whipsaw” effect on its price.
“Bitcoin’s [had] quite the run-up in Open Interest over the past 3 days,” pseudonymous crypto trader Daan Crypto Trades noted in a June 5 X post. Open Interest is the total number of derivative contracts, such as options or futures, that have not been settled — a rise could suggest more traders are speculating
BitLab Academy director Kelly Kellam explained that the sudden spike in Bitcoin’s OI and the continuation of positive funding rates suggest “the likelihood” of whipsaw action on Bitcoin’s price — which is when there is a sudden price spike in the opposite direction of the current trend.