Half of FIL open interest increase was price effect

Filecoin’s open interest jumped sharply between 12 and 13 September, but a large part of that increase is not new trading volume. According to market data platform Santiment, roughly half of the measured increase was the result of the higher price, not of new positions opened by traders. The unit of measurement matters.

In brief:

• Open interest in dollars rose by 48%, but measured in Filecoin it was only 25%.
• Filecoin’s price rose by around 18%, which explains half of the dollar increase.
• The actual peak in coins came higher and later than daily figures suggested.

Dollar increase distorts the picture

Between 12 and 13 September, open interest in Filecoin rose from $76.6 million to $113.9 million, an increase of 48%. That sounds like a large inflow of new trading positions. But anyone counting in coins sees a different story.

Measured in Filecoin, open interest grew from 95.5 million to 119.6 million FIL, a rise of 25%. The difference between those two percentages is largely attributable to the price rise of Filecoin itself, which came to around 18% in the same period. The coin simply became worth more, which automatically pushed up the dollar value of existing positions.

This mechanism applies to more coins, as was also visible earlier with Bitcoin open interest movements: a price rise inflates the dollar figures, even without any new positions actually being opened.

The real peak came later

Santiment notes that the real peak in coins only came later than the daily measurement points suggested. On 14 September at 06:00 UTC, open interest measured in FIL reached a top of 128.8 million FIL, higher than the daily mark on 13 September suggested.

That shows that, besides the price effect, genuinely new exposure was added, but less than the dollar headline suggests. Roughly half of the detected increase was a revaluation of existing positions due to the higher price, and the other half was genuine new market participation.

Why the unit of account matters

Santiment’s analysis shows that measuring in a coin’s own currency gives a more realistic picture of actual trading behaviour. Anyone looking only at the dollar value may see a strong increase in activity where there is in fact barely any.

For traders who want to know whether genuinely new positions are being taken, open interest measured in coins is therefore a more relevant metric than the dollar value alone.