Crypto Market Reclaims $3 Trillion for First Time Since January as Leverage Surge Fuels Volatility Warning

Forecast Trend Report by Period

The total market capitalization of cryptocurrencies has climbed back above $3 trillion for the first time since January, powered by Bitcoin’s sharp rally. But the rapid buildup in leveraged positions is also raising the risk of abrupt price swings.

Bloomberg reported on September 22, citing CoinGecko data, that the crypto market has recovered more than $740 billion in value since the U.S. Treasury announced an expansion of long-term bond buybacks last month. Bitcoin briefly rose to $87,381 during U.S. trading, its highest level since January, before slipping back to about $85,100 the following day.

Leverage has risen quickly alongside the rally. Total open interest in perpetual futures reached about $160 billion, the highest level since late October last year, according to CoinGlass. On Monday alone, about $920 million in short positions was forcibly liquidated as prices jumped.