Crypto data provider Coinglass’s tracking data indicates a rapid increase in the open interest – or in other words, the number of unsettled and active futures contracts – in Binance’s BNB.
Open Interest in BNB Rises to 1.57 Million
As of today, the total open interest in BNB, one of the top altcoins, has surged to 1.57 million BNB (equivalent to $360 million), reaching the highest level observed since January 1. This figure has risen by more than 8% within the last 24 hours and approximately 27% over the past week.
Current data indicates that BNB’s price dropped to $221 in the early hours of today, hitting the lowest level since December 12, 2022. Since the U.S. Securities and Exchange Commission (SEC) filed a lawsuit against giant crypto exchange Binance on June 5, BNB’s price has fallen over 25%.
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AAPLAn increase in open positions, alongside a price decline, often signifies an influx of short positions or investors acting on the anticipation of a further price drop, confirming the downward price trend.
The negative funding rate in the perpetual futures market also indicates BNB’s downward trend. The funding rate signifies the cost of maintaining a long or short position in the market. A negative rate demonstrates that those betting on a price drop (short position holders) are willing to pay those anticipating a price rise (long position holders) to keep their negative bets open.
Potential Chain Liquidation Threat in BNB due to Venus Protocol
Crypto analyst and trader Reetika Malik stated, “BNB is currently heavily shorted because there’s a risk of chain liquidation around $220 in the Venus Protocol, and if this happens, the decline could deepen further.” Venus Protocol is an algorithm-based money market system on the BNB Chain.
On the other hand, in an attempt to alleviate market concerns, Venus Protocol recently tweeted that if BNB’s price reaches the liquidation threshold, the BNB Chain core team will take over the BNB position on Venus.
