“Now’s a foul time to take paper bets on BTC,” stated technical analyst Willy Woo on June 2.
He stated it was “open season on liquidation hunts on account of excessive ranges of betting,” earlier than including that Bitcoin was “ready to purge the bets earlier than the following swing of all-time-highs.”
Paper bets are typically crypto derivatives equivalent to futures, options, and perpetual contracts that enable speculators to wager on the worth route with out ever holding the asset. Woo stated spot Bitcoin costs are exhausting to maneuver up with too many of those “on line casino hitchhikers” onboard.
NOW is a BAD TIME to take paper bets on BTC.
It’s open season on liquidation hunts on account of excessive ranges of betting.
BTC is ready to purge the bets earlier than the following swing of all-time-highs.
Chart: paper bets on BTC, exhausting to maneuver up with too many on line casino hitchhikers onboard. pic.twitter.com/bj9ikjdn8Q
— Willy Woo (@woonomic) June 2, 2025
Leverage Flush Imminent
Most derivatives gamblers use leveraged buying and selling, which tends to overheat markets and create extra volatility, particularly after they get liquidated.
When requested concerning the $100 million liquidation of Hyperliquid whale dealer James Wynn final week, Woo defined that the shopping for strain was low final week, which suggests “whales can push issues round.”
“In impartial environments, it’s straightforward to maneuver worth, particularly weekends and summer season months,” he stated earlier than warning:
“Now add incentives to earn a living by way of liquidations, it’s the right setup for liquidation hunts NOW.”
Bitcoin open curiosity (OI), or the variety of open futures contracts which have but to be settled, hit an all-time excessive of $80 billion on Might 23, according to Coinglass. It has since fallen to $72 billion however stays elevated, indicating a excessive stage of “paper bets” or leverage available in the market.
When OI surges, it signifies that large leveraged positions have constructed up with a lot of speculators holding massive positions with borrowed cash.
When the spot worth of BTC strikes in opposition to these over-leveraged positions, merchants get forcibly liquidated. These flushouts can create a cascade impact and amplify promoting strain, which may trigger a pointy decline in costs and volatility spikes.
BTC Value Outlook
Bitcoin prices are up marginally on the day, hitting an intraday excessive of $106,450 earlier than retreating to round $105,350 throughout Tuesday morning buying and selling in Asia.
Since falling from its Might 22 all-time excessive, the asset has remained in consolidation round present ranges for the previous few days. It seems very robust on the long-term view, however may see extra volatility if Woo’s “on line casino hitchhikers” get liquidated.
In the meantime, the M2 cash provide has simply hit an all-time excessive, which is sweet information for risk-on property equivalent to crypto.
M2 Cash Provide hits new all-time excessive of $21.86 Trillion pic.twitter.com/YoFxMlRqjY
— Barchart (@Barchart) June 3, 2025
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