- Negative macroeconomic factors and risk aversion may hinder the recovery of Bitcoin, Ethereum, and XRP

The price of Bitcoin briefly reached $60,000 earlier today, amid a continued downward wave driven by macroeconomic factors sweeping across the broader cryptocurrency market. These declines were reflected in the derivatives market, where total liquidations over 24 hours amounted to $2.6 billion on Friday.

Long position holders bore the brunt of the intense selling, losing $2.13 billion compared to $469 million for short position holders. Despite the massive liquidations in Bitcoin, Ethereum, and XRP, there are signs of a slight recovery, which could ease the suffering of investors still facing losses.

Crypto Liquidations | Source: CoinGlass
Open interest in Bitcoin futures contracts declined to around $47 billion, for the first time since mid-March, as retail investors heavily closed their open positions. The average open interest was $48.5 billion on Thursday, confirming an overextended price correction. If the situation does not improve, traders may refrain from increasing risk, reducing the buying pressure needed to maintain the bullish trend.

Bitcoin Open Interest | Source | CoinGlass
Similarly, the XRP derivatives market experienced further decline, with open futures contracts falling to $2.4 billion on Friday, for the first time in a year, compared to $2.57 billion the previous day. The value of open futures contracts represents the nominal value of the existing futures; thus, the ongoing decrease indicates a loss of investor confidence in XRP’s ability to sustain an upward trend.

Open Futures Contract Volume for XRP | Source: CoinGlass
Meanwhile, Ethereum saw an increase in outflows from spot ETF funds. According to SoSoValue data, institutional investors withdrew approximately $81 million on Thursday, marking the second consecutive day of outflows. As a result, total inflows decreased to $11.83 billion, with net assets under management at around $10.9 billion.

Ethereum ETF Inflows | Source: SoSoValue
Additionally, XRP ETF funds recorded modest inflows of $1.28 million on Thursday, down from $4.8 million the previous day. Despite the small decline, this marks three consecutive days of inflows, bringing total inflows to $1.21 billion, and net assets under management to approximately $888 million.