Bitcoin’s rally pushed total cryptocurrency market capitalization above $3 trillion for the first time in about eight months, after the cryptocurrency climbed nearly 8% on September 21 to above $87,300, its highest level since January. The move wiped out $920 million of derivatives-market short positions that day. Leverage has also increased, with open interest, or the value of outstanding derivatives contracts, in crypto perpetual futures reaching $160 billion, the highest level since late October last year, according to CoinGlass. Analysts caution that a leverage-driven correction becomes more likely when open interest and funding rates rise faster than spot buying demand. QCP Group chief trader Caleb Lin said growing open interest alongside spot demand is healthy, but faster derivatives growth can make the market self-reinforcing: even a modest decline could liquidate long positions, push prices lower and trigger further deleveraging. Bitget chief analyst Ryan Lee likewise said the risk of a leverage-driven correction increases when derivatives positioning and funding costs outpace spot demand. The rally therefore needs continued spot buying to advance, while the item’s accompanying photo was credited to Shutterstock.