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Bitcoin (CRYPTO: BTC) traders have borrowed heavily in a declining market five times since early October, according to Bitfinex analysts. In each of the first four borrowing episodes, more than $800 million in long positions were liquidated. The latest round began after Bitcoin closed its fifth consecutive losing week at $74,754 on November 8, 2026. Bitcoin traded at $73,227, down 2.6% in the past 24 hours and 5.6% over the week.
Leverage allows traders to borrow money to amplify their trade sizes. A trader puts up a small amount of their own funds, known as collateral, and the exchange lends the rest, enabling the trader to control more Bitcoin than they could with just their deposit.
When traders borrow to buy Bitcoin during price declines, it can signal confidence, as many believe they are buying at a low point. So does this latest round of Bitcoin leverage indicate a market bottom, or could it lead to outcomes similar to the previous four instances?
Offshore Traders Are Borrowing More as CME Open Interest Falls 15%
Bitfinex analysts have raised concerns about recent changes in open interest, which reflects the total number of active futures contracts. They noted a 15% drop in open interest for Bitcoin futures on CME Group (NASDAQ: CME | CME Price Prediction) from November 3 to November 8, while offshore positions rose. The CME is the regulated futures market for U.S. traders, indicating that larger institutional players are reducing their Bitcoin exposure.
On the OKX platform, open interest in Bitcoin perpetual contracts, futures that never expire and are often held with borrowed funds, rose to 36,220 BTC (approximately $2.65 billion) on November 10, up from 35,499 BTC a day earlier. Generally, rising open interest in a declining market suggests new long positions, which could benefit traders if prices eventually rebound. A similar trend was also seen earlier this month on the Hyperliquid exchange.
Every Borrowed Long Position Carries a Liquidation Price
Each borrowed position has a liquidation price, the threshold at which losses deplete collateral to the point that the exchange automatically sells the position to cover borrowed funds. In a declining market, these forced sales can exert additional downward pressure, pushing prices closer to the next liquidation wave. Analysts at Bitfinex said this chain reaction drove the outcomes of the first four borrowing episodes.
However, open interest data alone doesn’t clarify the balance of trade positions, since every futures contract has both a buyer and a seller. Therefore, rising open interest may indicate either new long or short positions. Bitfinex interprets the current scenario as leaning toward long positions, while OKX’s data only partially reflects offshore market dynamics.
Analysts pointed out that November 8 marked Bitcoin’s first close below the short-term holder cost basis of $75,893 during this uptrend, and it now trades about 3.5% below that figure. This cost basis represents the average price paid by recent buyers, and with many at a loss, selling to cut losses has become more common.
Additionally, a price rally stalled at $81,300 as buyers from October exited at breakeven, the same pressure seen when recent buyers hovered near breakeven in October.
Past Five-Week Losing Streaks Occurred During Bear Markets
According to Bitfinex, the median move four weeks after previous five-week losing streaks was a 14.1% decline. Their November 9 report notes that all past streaks happened during bear markets or capitulation phases, and the analysts still view the current decline as a correction. Therefore, these historical patterns may matter only if the current pullback transitions into a bear market.
Stocks and the November 13 Options Expiry Could Influence the Next Move
Stock market performance is likely to affect Bitcoin’s trajectory this week. Bitfinex has identified a strong correlation of 0.72 between Bitcoin and the Nasdaq-100 Index, where 1.0 represents a perfect relationship. They link the recent downturn to a sell-off in AI stocks following the midterm elections, ahead of an anticipated Consumer Price Index (CPI) inflation report.
Options traders expect limited movement for Bitcoin this week. Bitfinex noted, “We expect bitcoin to trade within the $72,350 to $79,400 range implied by options for the 13 November expiry, and to spend most of the week in its lower half.” Bitcoin is currently only 1.2% above the lower end of that range.
Current moving averages further align with this prediction. Bitcoin is trading 6.9% below its 20-day average of $78,621 and 10.3% below its 50-day average of $81,641. It’s also just slightly above its 200-day average of $73,162.
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Sam Daodu is a crypto analyst and the editor of 24/7 Wall St.'s Crypto Desk, where he covers Bitcoin, XRP, Ethereum, Solana and the altcoins investors search for most. His work focuses on price levels, spot ETF flows, on-chain data and the regulatory decisions that move crypto markets, written so a first-time buyer and a seasoned trader can both use it.
Sam has written about crypto professionally since 2019 and has published more than 2,000 articles. Before joining 24/7 Wall St., he wrote for crypto media outlets and Web3 companies and ghostwrote for crypto founders and token launches. His analysis is syndicated on Yahoo Finance, MSN and AOL and has been cited by other crypto news sites. He also founded MacLabs Marketing, a content and personal branding agency for crypto founders and executives.
When he isn't reading charts, Sam is usually at the gym or watching One Piece, a series he maintains has better tokenomics than most altcoins.
