• The open interest in SHIB Futures has risen above $100 million, indicating a speculative frenzy.
  • According to one analyst, the bitcoin supply-demand balance has reached 1:10. This indicates that this week’s rally will reach new highs.

BTC Price Index and Live Chart – CoinDesk”>(BTC) bulls as the leading cryptocurrency by market value looks to challenge record highs.

According to CoinGlass, the notional open interest (or dollar value) locked in active perpetual futures contracts linked to meme cryptocurrency Shiba Inu (SHIB), has exceeded $100 million for first time since August 20, 2023. SHIB Futures contracts are 1,000 SHIB each with up to a 25-times leverage.

SHIB’s capitalization has risen over 130% in the last seven days to $13.44million, surpassing the CoDesk 20 Index by 22%. A rise in open interest along with an increase in market value indicates a new influx of money into SHIB.

It’s an indication of speculative overreaction and a correction that is imminent for the market as a whole.

The open interest is now over $100 million. (CoinGlass) (CoinGlass)

In the past, a SHIB futures open interest of more than $100 million dollars has marked a local/interim bitcoin price peak.

SHIB’s not the only indicator of speculative frenzy. 10X Research data shows that South Korea has seen a recent average of or near $8 billion in volume, up from $1 billion per daily before the bitcoin bull market gained steam.

Markus Thielen of 10X Research said that the increase in trading volume at Korean exchanges was due to a “wave of retail activity” from altcoins and meme-coins.

Thielen said that bitcoin may reach a new high of $69,000 in the coming week, as the amount of BTC being created each day continues to exceed the daily inflows made into U.S. based spot ETFs. This has led to the supply-demand gap to increase to 1:10.

Over-the-counter trading desks deal with large institutional customers, and their aggregate inventory data shows that balances have dropped from almost 10,000 Bitcoins at the end of Q2 2023, to less than 2,00. It is clear that institutional investors, such as Bitcoin ETF issuers and their market makers will be forced to buy Bitcoins directly at exchanges. Thielen stated that the supply/demand balance is 1:10.

Grayscale’s spot-ETF (GBTC ) accelerated in the last few days, losing $600,000,000 on Thursday. This was its biggest single-day redemption for over a week. According to 10X Research’s data, BlackRock IBIT inflows slowed down on Friday from $500-600m after three days of steady growth.

Thielen says that the slowdown could be a temporary phenomenon at month’s end, and that strong inflows may resume this week.

We expect BlackRock to resume inflows this week. Bitcoin will move significantly higher if Grayscale’s outflows drop below $100m,” Thielen said.

Bitcoin was valued at $63,300 as of the time of publication, a gain of 2% on a daily basis and 22% in a week.

Parikshit Miishra is the editor.