On August 26, the crypto fear and greed index retreated to 65 points after jumping to 74 the day before. However, behind this seemingly cautious move lies far more interesting dynamics: open interest (OI) in bitcoin futures has fallen to nearly a five-month low, despite an impressive 22.4% weekly gain in the leading cryptocurrency.
The growth paradox: price rises while leverage falls
At the time of writing, bitcoin is trading just below $79,000, after reaching $80,000 during the recent rally. The decline in OI and moderate funding rates indicate that the current rise is not accompanied by a massive accumulation of leveraged longs. This is an important signal: the market is driven by spot demand rather than speculative overheating.
CryptoQuant's Bull Score indicator rose from 30 to 80 over the week — the highest since October 6, 2025. Eight of the ten tracked on-chain and market metrics are in the bullish zone. Visible spot demand is growing at the fastest pace since late December, and the simultaneous increase in demand across both spot and futures markets is being recorded for the first time since early October 2025.
Futures structure: institutional caution
The structure of bitcoin futures differs markedly from overall market sentiment. According to Glassnode, open interest expressed in bitcoin has declined from 645,760 BTC on August 14 to 587,584 BTC. This is a nearly five-month low. Over the same period, the price has risen from roughly $62,000 to $80,000. Typically, such a strong move is accompanied by rising OI from new leveraged positions, but this time it is the opposite.
A significant portion of the initial momentum came from the closing of short positions. Perpetual futures funding rates remain below 10% annually, consistent with a moderate predominance of bullish positions. The collateral structure deserves special attention: open interest in futures with cryptocurrency collateral has fallen to approximately 52,000 BTC — an all-time low. Such contracts account for only 11% of the market.
ETFs continue to attract capital
Amid declining OI, inflows into US spot bitcoin ETFs continued. On August 25, the funds attracted $314.3 million — the seventh consecutive positive trading session. BlackRock's IBIT accounted for $284.4 million. This confirms the thesis that institutional capital prefers spot instruments, avoiding excessive risk through derivatives.
XRP: a different picture
In certain altcoins, the market structure looks different. After XRP rose roughly 42% over the week, the estimated leverage ratio on Binance climbed to 0.21 — the highest since January. Daily XRP futures trading volume reached about $6.4 billion versus $1.2 billion on the spot market. On Binance, there are approximately two long positions for every account with a short position, and among the largest traders, the ratio approaches three to one. On August 26, XRP fell nearly 5% to $1.44, increasing the risk of forced liquidations and potentially amplifying a correction.
My analysis: Bitcoin's current dynamics demonstrate healthy demand without speculative overheating, reducing the risk of a sharp correction. However, amid XRP's rise with high leverage, the altcoin market remains vulnerable — and this could become a source of volatility in the coming weeks.