On Sunday, the price of Ethereum retested the $3,000 mark after trading below the level in recent days due to a volatile market environment. The ETH price may be gradually regaining bullish momentum, but other aspects are still under downward pressure, such as Open Interest (OI).
Sharp drop in open interest for Ethereum
In the current volatile state of the cryptocurrency landscape, the Ethereum derivatives market signals a key indicator. This crucial signal comes from interest in ETH Open, which has seen a significant decline in recent months. According to According to research by advanced on-chain investing and data analytics platform Alphractal, the metric has fallen by half or 50% since August of this year.
A significant decline in this indicator clearly indicates that traders’ positioning and risk appetite have changed significantly. After a period of high leverage and aggressive speculation, the sharp collapse indicates that positions are being unwound, exposure is being reduced and momentum is losing steam in the futures markets.
Alphactal emphasized that the Open interest in Ethereum is valued at about half of what it was in August 2025, suggesting a drastic decline in market risk. Such a move indicates that institutions and large whale holders have closed leveraged ETH positions. Exits from positions by large investors show that they are reducing their exposure and speculative pressure.
ETH open interest has also fallen sharply on cryptocurrency exchanges. After looking at the breakdown of Ethereum Open Interest by exchange, Alphractal revealed a 31% drop to $7.64 billion on the world’s largest exchange, Binance.
On Gateio, open interest stood at $3.72 billion, down 15%, while HTX (formerly known as House) fell 12.65% to $3.12 million. Additionally, Bybit has $2.53 billion with a 10.25% decline, HyperLiquid has $2.51 billion with a 10.18% decline, and Bitget has $1.79 billion with a 7.25% decline.
With open interest rates on the stock exchanges falling, this tells a fascinating story of the current market structure. This demonstrates robust deleveraging across the Ethereum market and a lower probability of explosive movements in the short term.
Generally, a more cautious and protective atmosphere involves stages of consolidation or preparation for the next trend stage. However, large declines in open interest rates have historically often preceded significant structural changes, whether a healthier turnaround or a continuation of the decline with less leverage.
ETH withdrawals from crypto exchanges increased
Ethereum open interest drop comes at a time of massive decline ETH supply on crypto exchanges. Currently, ETH withdrawals have reached their lowest levels since 2016, reflecting increasing caution among traders and easing near-term selling pressure.
As more ETH is removed from exchanges and placed in long-term storage locations, the liquid supply continues to diminish. While decreasing supply increases ETH volatility, it also encourages increased price pressure.
Featured image from iStock, chart from Tradingview.com
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