Bitcoin has remained resilient amid market turbulence, while altcoins have suffered a brutal sell-off, leading to liquidations between $8 billion and $10 billion. According to a report from Bybit and Block Scholes, volatility erased billions in open interest, with funding rates for altcoins turning deeply negative.

Bitcoin Stays Steady as Altcoins Crash

Market turbulence wipes out billions in open interest
Bybit’s research shows that Bitcoin outperformed the broader crypto market, maintaining stability while Ethereum and other altcoins suffered severe losses. Bitcoin’s perpetual swaps remained strong, whereas Ethereum's options market volatility skyrocketed to over 140%, its highest level in three months.

Liquidations Hit Hard Across Crypto

Over $3.1 billion in open interest vanished
Bybit CEO Ben Zhou estimated that the total notional value of liquidated positions reached at least $8 billion to $10 billion. The impact was especially severe across major altcoins, including ETH, XRP, and SOL, where over $3.1 billion in open interest was wiped out.

Funding Rates Show Bearish Sentiment

Altcoins suffer deeper negative funding rates
Bybit reported that funding rates turned negative for most altcoins, signaling a strong bearish sentiment. In contrast, Bitcoin remained stable, with its options market avoiding a major liquidation event. Unlike perpetual swaps, Bitcoin’s term structure inversion quickly recovered, reflecting renewed investor confidence.

Trading Volume Surges Amid Market Chaos

Crypto traders push record volume despite the downturn
Despite the sell-off, trading volume surged, with over $31.1 billion in perpetual swaps traded on February 2—the highest daily volume in over a month. Short-term volatility for Bitcoin eased after an early-week spike, indicating a potential return to stability in the near future.

What’s Next for Bitcoin and Altcoins?

Will the market recover, or is more pain ahead?
With altcoins facing extreme pressure and Bitcoin holding strong, the market is at a crucial turning point. Analysts will be closely watching funding rates and open interest levels in the coming weeks to determine whether crypto has found a bottom or if another wave of volatility is ahead.