Bitcoin (BTC) forced the closure of $740 million in leveraged positions on Oct. 21 as the price swung from $110,552 to $114,019 before retreating toward $108,000, executing a classic short-squeeze followed by long liquidations that cleared excessive derivatives exposure.

Data from Coinglass shows $435.63 million in long positions and $304.64 million in shorts eliminated during the 24 hours.

When Bitcoin broke through the $111,500 liquidity zone, perpetual shorts faced cascading margin calls, reaching up to $114,000.

As upward momentum waned, long positions that had chased the breakout were liquidated during the decline, a pop-and-flush pattern characteristic of leverage resets.

Approximately $320 million in unwinds occurred around the dip to $108,000, with variations across data providers depending on the measurement window.

Funding rates entering the session sat near neutral following the prior week’s selloff, while futures open interest rebuilt toward $26 billion.

Open interest across futures and perpetuals held relatively stable through the volatility. CoinMarketCap data shows that futures open interest registered $3.47 billion, with a 0.91% daily increase, while perpetuals showed $969.71 billion, with a 0.02% decline.

Funding rates compressed from positive 0.005% to 0.004%, reflecting reduced willingness to pay premiums for leveraged long exposure after the round-trip price action eliminated speculative positions on both sides.

Derivatives neutrality signals a cleaner setup

The liquidation sequence left funding rates roughly flat and open interest lower than recent peaks, removing the overhang of crowded positioning that amplifies volatility.

Confirmation of a genuine reset requires several observable conditions over the following 24 to 48 hours.

Open interest (OI) should remain below prior peaks rather than immediately rebuilding through fresh leverage. OI-weighted funding rates need to center near zero percent across major venue

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Author: Gino Matos