Bitcoin just faced largest deleveraging since 2023

Bitcoin ($BTC) experienced one of its largest deleveraging phases on record and the biggest since 2023 in 2026, per the analysis shared on X by CryptoQuant’s Darkfost early on September 7.

Indeed, according to the cryptocurrency expert, the preceding futures-dominated cycle led to a significant reduction in positions backed by borrowed money, with the year’s volatility ensuring that both short and long bets that became ‘too heavy’ got liquidated.

Darkforst highlighted that the overall phase saw one of its starkest moments when $BTC open interest on Binance fell below its 180-day average.

He, however, also highlighted that the liquidations failed to fully eliminate leverage and that, by the time of his X post, levels remained elevated. For example, Binance open interest again increased after the brief plunge and stood at $9.6 billion at the time. The 180-day average is at $8.3 billion.

Still, the expert also noted that the phase was ‘necessary’ for Bitcoin and that, despite it being ‘tough on traders’, more recent data hints at a bullish rebound for the world’s premier cryptocurrency. He, however, also urged caution since the recent resurgence in open interest also raises the risk of a new deleveraging event.