Bitcoin Derivatives Might Not Fully Recover From October Crash Until Q2

The October 10 crash caused a $19 billion loss in Bitcoin derivatives open interest. Currently, the open interest for futures, options, and perpetual contracts is around $140 billion, down from $220 billion prior to the crash. Max Xu, Bybit’s derivatives operations director, noted that it could take two quarters for activity to recover, contingent on favorable macro conditions, such as interest rate cuts and improved market sentiment. Although there was a massive spike to $748 billion in derivatives volumes during the crash, that figure has now normalized to approximately $300 billion. The upcoming December options expiry features significant clusters of call contracts at various strike prices. The overall reduction in open interest suggests the last month of the year will see lighter positioning, potentially stabilizing the market compared to previous high-leverage conditions. Xu believes the situation may pave the way for a healthier derivatives market into 2026, despite possible short-term volatility due to challenges or inflows related to ETFs.

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