Crypto Leverage Surges as Futures Activity Hits New Records

Leverage surges as crypto futures liquidations triple, signaling a risk-heavy market setup.

Bitcoin dominance grows as ETFs drive cash-market price discovery and strong capital inflows.

Institutional holdings rise as Bitcoin settlement volumes surpass major global payment networks.

Daily crypto liquidations now surge at a pace that alarms analysts, as rising leverage reshapes market behavior across major exchanges. The latest Glassnode and Fasanara report shows where this cycle shifted, why it matters, who drives the trend, and how the market structure changed

The firm observed sharp growth in leverage and futures speculation across global platforms. They also noted accelerating spot activity that pushes Bitcoin into a new phase of institutional influence. Besides that, traders now face faster liquidation events as open interest expands.

The report explains that this cycle records far larger daily futures wipeouts. Traders now lose about $68 million in long positions each day. They also lose $45 million in short positions. The previous cycle only recorded $28 million long and $15 million short. Hence, the scale of risk grew sharply. Moreover, analysts link this rise to heavier leverage and broader exchange participation.

Futures Market Turns More Aggressive

Futures markets now dominate activity. Open interest recently climbed to $67.9 billion. Additionally, daily futures volumes touched $68.9 billion in mid-October. Perpetual contracts control more than 90% of that flow. However, the market showed its fragility on Oct. 10

Bitcoin dropped from $121,000 to $102,000. Long traders then lost more than $640 million each hour. Consequently, open interest collapsed by 22% in under 12 hours. Glassnode called it “one of the sharpest deleveraging events in Bitcoin’s history.”

Spot trading also grew. Bitcoin’s daily spot volume now sits between $8 billion and $22 billion. During the Oct. 10 crash, hourly spot trading reached $7.3 billion. Buyers quickly moved in to accumulate discounted BTC rather than exit the market.

Institutional Demand Reshapes Bitcoin

ETFs changed the structure of price discovery. Since early 2024, US spot ETFs shifted discovery to the cash market. Futures markets now hold most leverage. Moreover, capital flows strengthened Bitcoin’s dominance. Its market share climbed from 38.7% in late 2022 to 58.3% today. Monthly inflows range between $40 billion and $190 billion

The network absorbed $732 billion since the 2022 low. Hence, Bitcoin’s realized cap hit a record $1.1 trillion. Glassnode stated, “This highlights a more institutionally anchored and structurally mature market environment.”

Additionally, settlement activity soared. Bitcoin processed $6.9 trillion in transfers over 90 days. That figure surpassed Visa and Mastercard volumes. Meanwhile, institutional entities now hold 6.7 million BTC. ETFs alone absorbed 1.5 million BTC this year. Centralized exchange balances keep declining as institutional treasuries expand.

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