In brief
- Altcoin open interest has jumped to $38 billion, closing in on Bitcoin’s $40 billion and topping Ethereum’s $30 billion, signaling heightened speculative activity.
- Experts warn the leverage buildup could spark liquidations if the Fed’s expected rate cut triggers a shift in sentiment.
- Political pressure on Chair Jerome Powell and signs of elevated implied volatility add to expectations of sharp swings in the days ahead.
A surge in leveraged bets on altcoins is beginning to build ahead of a key Federal Reserve policy decision this week, a move that could introduce significant volatility to the crypto markets this month.
Altcoin open interest is now close to surpassing Bitcoin’s, a setup that has historically preceded a drawdown in blue-chip digital assets.
“An uptick in altcoin leverage is the eagerness for alt season,” Stephen Gregory, founder of crypto trading platform Vtrader, told Decrypt.
Gregory pointed to the recent rally for altcoins last week and leveraged bets as evidence for the shifting sentiment.
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Author: Akash Girimath
