Dogecoin Futures Open Interest Drops 8.7% as Traders Exit Positions

Dogecoin has resumed its price decline after a brief recovery, with its derivatives market showing clear signs of trader withdrawal. The largest meme cryptocurrency by market capitalization recorded an 8.7% drop in futures open interest over the past 24 hours, according to CoinGlass data published Wednesday, February 4.

The decline reflects growing caution among futures traders as uncertainty grips the broader cryptocurrency market. Open interest, which measures the total value of unsettled futures contracts, has fallen to 10.84 billion DOGE tokens worth approximately $1.16 billion.

This withdrawal comes as Dogecoin’s price has retreated to retest the $0.10 level, marking a multimonth low for the popular meme asset. The simultaneous decrease in open positions and price decline suggests traders are actively managing risk rather than speculating on near-term recovery.

Traders Close Positions Rather Than Open New Ones

The drop in open interest coincided with a sharp 43% increase in trading volume, revealing an important market dynamic. Traders are not sitting idle. Instead, they are actively repositioning their portfolios by closing leveraged positions rather than initiating new trades.

This pattern typically emerges when market participants face heightened uncertainty and prefer to reduce exposure to volatile assets. The combination of declining open interest and rising volume indicates a wave of position closures across major exchanges.

The behavior marks a shift from the speculative enthusiasm that characterized earlier trading periods. Futures traders, who previously bet on price movements using leverage, are now prioritizing capital preservation over aggressive positioning.

Options Market Shows Mixed Signals

While futures open interest declined sharply, Dogecoin’s options market painted a different picture. Options open interest increased by nearly 6% during the same period, even as options trading volume plummeted by 52.69%.

This divergence reveals a complex market sentiment. The rise in options open interest suggests traders are maintaining existing hedging strategies. Many appear to be holding protective positions established during earlier periods of stability.

However, the massive drop in options volume indicates minimal new hedging activity. Traders on platforms including Binance are keeping current positions intact but showing clear reluctance to commit fresh capital to new options contracts.