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Home Cryptocurrency news

Black Thursday Has Destroyed BitMEX Bitcoin Open Interest, Hits Historical Lows

Tony Spilotro by Tony Spilotro
10 months ago
in Cryptocurrency news, Bitcoin
Reading Time: 2min read
Black Thursday Has Destroyed BitMEX Bitcoin Open Interest, Hits Historical Lows
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The cryptocurrency margin trading platform that once enjoyed the crown across the industry, has just reached a historical low on the platform’s now-notorious Bitcoin open interest.

According to data, the once industry leader has been on a downward trajectory ever since the Black Thursday collapse that not only crushed Bitcoin prices, but may have put a permanent stain on the reputation of the top dog.

BitMEX Open Interest Drops By 68% Data Shows, Is the King of Bitcoin Margin Trading In Trouble?

The leading cryptocurrency by market cap, Bitcoin, was trading well above $10,000 at the start of the year, but failed to incite further FOMO, and the price reversed.

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On the way down, coronavirus fears spun out of control, causing a historical selloff across all assets on a day now forever referred to as Black Thursday.

Related Reading | Bitcoin Just Flew to $8,400, Leaving $40M of BitMEX Destruction In Its Wake 

Stock markets collapsed, safe-haven assets like gold and silver suffered, and cryptocurrencies were decimated. Bitcoin fell over 40% in 24 hours, while the rest of the market tanked by over 70% in many cases, reaching new bear market lows.

On the way down, things quickly got dangerous for Bitcoin, as BitMEX essentially could no longer control its liquidation engine, which caused a cascade effect of longs being squeezed and the price collapsing further.

It wasn’t until BitMEX was taken offline, that prices on spot platform began to rebound. The impact of BitMEX was so apparent at this point, that it left a bad taste in trader’s mouths, and the platform quickly became a ghost town.

It’s even caused a distinct distrust in cryptocurrency exchanges in general, which has prompted more crypto investors to move their BTC off exchanges and into cold storage.

This has resulted in a BitMEX’s open interest – a metric depicting how many open positions are currently on the line and how much BTC and cash equivalent value is wagered – hitting historical lows, according to data from Arcane Research.

bitcoin bitmex open interest crypto btc

Levels fell to the lowest since October 2018, just one month before Bitcoin’s drop to its bear market bottom at $3,200. Worse yet for BitMEX, Arcane’s analysis “reveals a grim reality for the platform”

“Since the all-time high OI of 147,810 BTC, the open interest has now declined by 68.5% to 46,610 BTC,” a weekly report reads.

Related Reading | Dr. Doom Roubini Fuels Criminal Crypto Concerns With Scathing Bitcoin Op-Ed 

BitMEX has earned itself a negative reputation in the past due to order submission errors, a probe from the CFTC, and a public spat with economist Nouriel Roubini. But this may be the last straw for traders, who will be forced to find greener pastures such as SimpleFX, FTX, and other popular margin trading platforms suddenly picking up steam as a result of the void left behind by BitMEX.

Featured image from Pixabay
Tags: bitcoinBitMEXbtcusdcrypto
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Tony Spilotro

Tony Spilotro

I'm Tony Spilotro. Behind the pseudonym, I'm a digital media executive and global remote work leader with a decade of content experience and excellent. Here, I explore my newfound passions pertaining to privacy, finance, economics, politics, cryptography, property rights, and other libertarian-esque views. I am a Bitcoin evangelist, maximalist, and educator whenever I can be, helping to spread its message of freedom from government control, monetary policy mismanagement, and passing the buck - literally – to future generations. My journey from a curious retail crypto investor to a serious Bitcoin advocate, trader, and technical analyst is an unusual one, but life-changing nonetheless and has become less about money and more about a long-overdue revolution. While a firm believer in the laws governing math and science, I am profoundly fascinated by the impact of astrology and astronomy including moon and solar cycles and planetary alignment and their ability to influence and potentially predict markets. It hasn't yet clicked for me as to how to put anything to use, but I consider it my current rabbit hole I can't yet dig out of. My perspective of growing up alongside the internet, the dot com era, the Great Recession, and roots in video games collecting coins and rare items caused Bitcoin to immediately make sense to me. Through all of these lenses, I seek to produce content that is educational and entertaining, and I thank you sincerely for taking the time to read what I have to say. Please follow me on Twitter and feel free to drop me a line if you would like to work together.

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