Futures Open Interest Decline in Key Cryptocurrencies

Futures open interest in key cryptocurrencies has decreased significantly, suggesting that traders are reducing their positions amid macroeconomic uncertainty.

Crypto traders are scaling back long positions as uncertainty builds, with futures open interest dropping sharply due to worries about a trade war and the Fed’s stringent policies. In a March 4 post on X, the Singapore-based blockchain firm Matrixport reported a significant decline in open interest for Bitcoin (BTC), Ethereum (ETH), and Solana (SOL) futures.

> 📊Today’s #Matrixport Daily Chart – March 4th 2025🔽
>
> Crypto Market in Risk-Off Mode: Futures Unwinding Amid Macro Uncertainty
> #Crypto #BTC #BTCETF #CryptoMarket
> — Matrixport Official (@Matrixport_EN) March 4, 2025

> “Notably, Ethereum’s open interest has dropped back to levels last seen in the summer of 2024. Despite Trump’s recent tweet about a potential Strategic Bitcoin Reserve and the upcoming White House Crypto Summit on March 7, the market remains in risk-off mode, as participants cut exposure.”
>
> — Markus Thielen, Independent Analyst

The blockchain firm notes that many traders seem to be waiting for clearer signals before re-entering the market, with the Fed’s policies remaining a key concern.

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This warning comes as U.S. President Donald Trump announced that 25% tariffs on goods from Mexico and Canada would take effect on March 4, heightening trade tensions and unsettling financial markets.

In late February, Matrixport’s analysts cautioned that Bitcoin’s price could remain under pressure until April, driven by a stronger U.S. dollar and shifting market dynamics. With Bitcoin increasingly tied to traditional finance, analysts now expect the price downturn to persist until April, after which Bitcoin may attempt to recover to previous highs.

Matrixport also noted the growing importance of Wall Street investors. While wealth and asset managers view Bitcoin as a long-term investment, hedge funds are employing arbitrage strategies to capitalize on Bitcoin’s price volatility. Matrixport pointed out that these hedge funds collectively hold $10 billion in Bitcoin ETFs, with total inflows reaching $39 billion, indicating that at least 25% of Bitcoin ETF capital is linked to arbitrage trades.

Read more: Crypto ETFs can become the third-largest asset class in the U.S. by the end of 2025, State Street forecasts.