Crypto markets appear to have moved past the leverage-driven stress seen in October, according to asset manager Grayscale. Recent research shared by the firm suggests derivatives activity has stabilized, supply pressure has eased, and market direction is now more closely tied to fundamentals and policy developments. As a result, price action may be better positioned to respond to upcoming regulatory and institutional shifts rather than past disruptions.
Grayscale noted on social media platform X that post-October 10 deleveraging no longer plays a meaningful role in recent crypto valuations. Attention has shifted away from forced unwinds toward forward-looking drivers, including steadier derivatives markets and reduced selling by long-term holders.
Derivatives data from October showed a sharp reset across major exchanges after large liquidations hit perpetual futures markets. Open interest across OKX, Bybit, Binance, and Hyperliquid dropped from about $90 billion-$100 billion in late September to roughly $55 billion following the Oct. 10 event.
Instead of continuing to fall, aggregate open interest moved sideways through November and December, holding near $50 billion. Binance and Bybit continued to hold the largest shares, while OKX and Hyperliquid maintained smaller but consistent positions.
Grayscale stated that, based on these trends, recent pricing has not been shaped by lingering leverage effects. Futures open interest rose slightly in December, while options open interest declined mainly due to contract expirations rather than position closures. Taken together, activity pointed to stable exposure rather than aggressive risk-taking.
Several signals reinforced the view that December marked a consolidation phase:
Patterns across derivatives venues suggested traders stayed engaged after October’s reset instead of exiting the market. Price behavior during the period aligned with that view, as Bitcoin showed limited directional movement and no sharp volatility spikes.
Supply-side data also eased concerns about selling pressure. Grayscale reported no signs of significant Bitcoin distribution by early investors, often referred to as “OG whales.”
On-chain data tracking when coins last moved showed Bitcoin’s average lifespan increased during December. Rising lifespan readings typically signal holding rather than selling, suggesting early holders did not add pressure during the month.
Long-term holder activity followed a similar pattern. Absence of notable selling reduced the risk of structural supply overhang, especially after tax-related flows seen earlier in the year had already passed. With leverage pressures fading, Grayscale said future crypto pricing is more likely to respond to clearer policy signals and expanding institutional activity.
