ETH Deleveraging Nearing Its End, Market Cap Shrinks by $54 Billion

On October 25, CryptoQuant analyst Darkfost pointed out that Ethereum has been generally weak over the past three weeks, with ETH pulling back approximately 15%, resulting in a market cap evaporation of about $54 billion. The open contracts for ETH on Binance have decreased by about $1.3 billion over the past month, a drop of nearly 20%, falling to around $5.7 billion. The total open contracts across the market have now dropped to about $11.5 billion. Darkfost's analysis suggests that the market deleveraging is mainly due to price declines triggering liquidations and traders actively reducing their positions. In July, open contracts saw a significant drop, followed by a technical rebound of over 32% for ETH, with prices returning above $2,800. Such deleveraging is usually accompanied by market panic and often occurs at the end of a pullback.

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