Bitcoin derivative market recovers: Futures open interest increases by 13% in January

The cryptocurrency market shows early signs of recovery after the massive sell-off in Q4 2025. Open interest in Bitcoin futures is increasing again, signaling a cautious return of risk appetite among professional derivatives traders. However, market observers warn that this recovery remains modest and market participants’ confidence is returning only gradually.

From Crisis to Recovery: The Four-Month Cycle

Open interest in Bitcoin futures, a key indicator of participation in the derivatives market, has increased by nearly 13% since the beginning of 2026, according to data from Coinglass. This recovery follows a dramatic reduction in leveraged exposure during October to December, when Bitcoin markets experienced one of the largest liquidation events of the entire cycle.

During this critical period, open interest collapsed from 381,000 BTC to 314,000 BTC—a decline of about 17.5%. At the same time, Bitcoin itself lost approximately 36% of its value from October’s high. CryptoQuant analyst Darkfost characterized this decline as a “broad phase of risk mitigation,” during which traders unwound their leveraged positions amid increased volatility. “This cycle marked a clear process of apology, where market participants systematically reduced their exposure,” the analyst explained.

Open Interest Rises from Yearly Lows – Gradual Normalization

After falling to an eight-month low of around $54 billion on January 1, open interest has since steadily recovered. By January 19, it had already risen to over $61 billion.

Notably: On January 15, open interest briefly reached an eight-week high of $66 billion before stabilizing again. “Open interest is gradually recovering,” observed Darkfost. “This indicates a slow return of risk appetite, with the current recovery being rather moderate.”

Open interest represents the total value of all open and unsettled derivative contracts. Rising OI typically signals increasing market participation and risk appetite, while falling OI indicates unwinding and deleveraging.

Market Cleanup as a Foundation for Future Growth

Despite the recent recovery, Bitcoin futures open interest remains well below its all-time high of $92 billion from early October—a gap of about 33%. Market analysts, however, suggest that such extended apology pauses historically play a structuring role in market architecture.

“Such contraction phases often mark significant turning points,” Darkfost explained. “Excess leverage is systematically reduced, creating a more solid foundation for a potential bullish recovery.” The liquidation wave in October wiped out billions in leveraged positions and reduced the risk of cascading liquidations near key support levels.

Options Take the Lead: A Structural Shift in the Derivatives Market

While futures activity is gradually returning, Bitcoin options markets have gained the upper hand. Nic Puckrin, co-founder and CEO of Coin Bureau, observed that last week, open interest in options surpassed that of futures—indicating a structural shift in derivatives positioning.

According to data from Checkonchain:

• Open interest in Bitcoin options: ~75 billion dollars
• Open interest in Bitcoin futures: ~61 billion dollars

Unlike futures, options contracts give the buyer the right—not the obligation—to buy or sell at an agreed-upon price. This reduces the risk of forced liquidations and leads to more stable price movements. “This means larger market participants are positioning themselves through hedging and expiry structures rather than making directional bets,” Puckrin explained. “It’s no longer just about betting up or down. The Bitcoin market is behaving less like a casino and more like an established financial system.”

$100,000 Strike: The New Psychological Key Level

Deribit data shows that the $100,000 strike price currently has the highest concentration of open Bitcoin options positions, with a nominal exposure of around $2 billion. This positioning indicates that traders are increasingly preparing for volatility around psychologically significant price levels rather than short-term leverage.

Market analysts say that the growing dominance of options over futures could shorten liquidation chains and create more precise support and resistance levels as the market evolves. With Bitcoin currently at $84,040, the $100,000 mark remains a critical focal point for market participants. This reorientation of the derivatives infrastructure could lead to a more stable and mature market structure in the long term.