During the recent market downturn, Bitcoin demonstrated remarkable resilience, while altcoins endured significant liquidations estimated between $8 billion and $10 billion, according to recent findings.
A sudden surge in volatility rattled the cryptocurrency market, leading to the disappearance of billions in open interest. Reports indicate that while Bitcoin (BTC) maintained stability, altcoins suffered greater losses.
Recent data highlights Bitcoin’s performance as it “outperformed relative to the wider crypto market,” with its perpetual swaps showing more resilience. In stark contrast, the Ethereum (ETH) options market experienced a dramatic increase in short-term volatility, exceeding 140%—the highest rate observed in over three months.
Liquidations were severe, with estimates from industry leaders suggesting that the actual notional value of liquidated positions could reach between $8 billion and $10 billion. The total open interest across Bitcoin, Ethereum, XRP, and Solana saw a reduction of over $3.1 billion following a peak on Friday.
Funding Rates Experience a Downturn for Altcoins
The funding rates mirrored the bearish trend, with altcoins exhibiting significantly deeper negative funding rates post-crash, while Bitcoin remained comparatively stable. Open interest plummeted across major altcoins, but Bitcoin’s options market surprisingly avoided a major liquidation crisis, with any term structure inversions resolving quickly.
Despite the overall market instability, trading volume witnessed a notable increase, with more than $31.1 billion in perpetual swaps traded on February 2—marking the highest daily volume in over a month. For Bitcoin, short-term options volatility has begun to stabilize after an earlier spike, hinting at a potential return to calm in the market.
