Crypto Traders Turn To Other Assets As Leverage In Bitcoin Bets Declines

Traders are reducing leverage on Bitcoin and crypto after market crashes. Derivatives tied to traditional financial assets are gaining increased market adoption. Economic uncertainty and delayed regulations continue to weigh on market sentiment. Cryptocurrency derivatives markets are seeing a change in trading activity with leveraged positions in Bitcoin, Ethereum and smaller tokens declining while contracts linked to traditional financial assets are gaining ground. Crypto leverage trading allows traders to control positions larger than the margin they deposit, thereby boosting potential gains and losses. Perpetual futures are derivative contracts without a fixed expiry date that provide leveraged exposure to an asset’s price. According to Bloomberg, Bitcoin perpetual futures have lost around $8 billion in open interest, while Ethereum contracts have shed approximately $5 billion and smaller tokens another $10 billion.

First reported by Outlook Money. This page is a short excerpt; the full text is theirs.