Altcoin Open Interest Surpasses Bitcoin But Altseason Remains Unconfirmed

On September 6, the open interest of altcoins surpassed that of bitcoin. This is a first since December 2024. Such a shift confirms the rise of leverage on Zcash, XRP, and Solana. However, this is not enough to announce an altseason.

Leverage shifts towards altcoins

Now, perpetual contracts on altcoins represented a higher value than contracts on bitcoin. The open interest of BTC was close to 23.9 billion dollars, or 37% of the total observed.

Indeed, open interest determines the value of derivative contracts that remain open. It increases when new positions emerge and decreases if traders close their contracts and face liquidations. Unlike volume, it does not count exclusively the transactions executed during a period.

Four elements are necessary for interpreting this shift :

• Altcoins surpass bitcoin for the first time since December 2024 ;
• Bitcoin retains about 37% of the open interest of perpetual contracts ;
• Ethereum, Solana, XRP, and Zcash concentrate a significant part of the rest ;
• An increase in the indicator counts both long and short positions.

The bullish scope of the signal is limited by this last point. Thus, altcoins’ open interest reveals that traders are taking more risks on these cryptos. It does not allow to know whether the majority anticipates a rebound or a drop.

Its value expressed in dollars can also evolve mechanically when asset prices increase. It is therefore necessary to compare its progression with prices, funding rates, and spot market volume.

Zcash concentrates part of the speculation

The most spectacular case is represented by Zcash. At the beginning of this September, ZEC’s open interest approached a record close to 2.4 billion dollars, according to reported data. Meanwhile, the crypto rose 134% in one month to temporarily exceed 1000 dollars.

Such progression caught many short sellers off guard. Nearly 34 million dollars of short positions were liquidated during the crossing of the 1000 dollar level on September 4.

Many positions remain heavily exposed. On Hyperliquid, a short position opened by trader Garrett Jin around 444 dollars revealed an unrealized loss of 25.7 million dollars. Another seller risked liquidation when ZEC approached 1317 dollars.

XRP and Solana also contribute to the increase in altcoins’ open interest. However, available statistics do not allow to truly attribute each asset’s contribution to the general surpassing of bitcoin.

The movements can be amplified by such concentration. A quick rebound forces sellers to repurchase their positions, supporting prices. Conversely, a drop can cause chain liquidations among buyers.

The market has not yet entered altseason

However, it should be noted that the 2024 precedent invites caution. At the conclusion of the last surpassing of bitcoin by altcoins, many mid-cap cryptos suffered major corrections. This succession does not prove that the open interest shift systematically triggers a drop.

The altcoin market, however, holds lower liquidity. A significant liquidation can therefore weigh more on their price than on bitcoin’s, especially if order books cannot absorb forced sales.

Other indicators do not yet attest to a global altseason. The Altcoin Season Index was at 43 at the end of August, while Blockchain Center sets the confirmation threshold at 75. Moreover, global interest in the term “altcoin” was only around 26 out of 100 on Google Trends.

Bitcoin also maintained a dominance close to 59.2% of the crypto market. Also, altcoins outside the top 10 had admittedly gained more than 10% since the beginning of September, with a valuation above 200 billion dollars. However, this growth remained concentrated on a limited number of cryptos.

Liquidations, funding rates, and spot volumes will now determine the movement’s solidity. A rise supported exclusively by leverage would remain vulnerable to a brutal correction.