Ethereum traders on Binance just went through a forced spring cleaning. Approximately $345 million in long positions were liquidated on the exchange during an October 8-9 sell-off, according to a CryptoQuant analysis published October 16, 2026.
CryptoQuant’s read is that the flush reset leverage and improved market structure. A truly bullish setup, though, still depends on two things the market doesn’t yet have: USDT flowing back into exchanges and a rising Coinbase Premium.
What the liquidation event actually did
ETH fell roughly 10% from its September highs, sliding from approximately $2,775 to approximately $2,500. That drop was enough to knock over a large stack of leveraged long bets on Binance.
Long liquidations on Binance increased by 47%, per the CryptoQuant data. Funding rates on the exchange dropped to near zero.
Funding rates are the periodic payments that keep perpetual futures prices tethered to spot prices. When they run high, longs are paying a premium to stay in the trade, which usually signals crowded optimism. Near zero means that crowd has thinned out considerably.
Binance’s ETH futures open interest fell 4.7% over 30 days to around $6.1 billion. That figure represents roughly half of the total market.
Binance’s share hits a multi-year high
Even as dollar-denominated open interest declined, Binance’s share of ETH futures open interest climbed to around 49% following the liquidations. That is the highest level recorded since 2023.
The more telling metric is open interest measured in ETH rather than dollars. That figure rebounded to approximately 2.46 million ETH.
Why the distinction matters: dollar-denominated open interest falls automatically when the price drops, even if nobody closes a single position. Counting in ETH strips out that price effect. A rebound in the ETH-denominated number suggests traders are reopening positions after the flush rather than walking away from the market.
Binance ETH reserves fell by 2.4%, which points to lower supply pressure. Meanwhile, Ethereum’s staking rate sits at 36.1%, placing it in the 98.6th percentile.
The missing ingredient: fresh capital
USDT reserves on Binance decreased by 2.3%, reflecting a net outflow of approximately $175 million. That is why CryptoQuant characterizes conditions as neutral rather than bullish. The leverage reset lowered liquidation risk, but a cleaner market without new money is a well-tuned car with an empty tank.
The second signal to watch is the Coinbase Premium. It measures the price gap between ETH on Coinbase and on other exchanges. A rising premium is commonly read as stronger demand from buyers on the US-based platform, and the research flags it as a potential indicator of renewed institutional interest.
What this means for ETH traders
The immediate takeaway is that the risk of another liquidation cascade looks lower than it did in September. With funding rates near zero, the market is no longer leaning heavily on leveraged longs.
The $175 million USDT outflow from Binance runs in the opposite direction of what a sustained recovery would typically require. The concentration at Binance cuts both ways: a 49% share means positioning on a single venue shapes much of the ETH futures picture.
For anyone tracking the next move, the checklist from the CryptoQuant analysis is short. Watch whether USDT reserves on exchanges start climbing again. Watch whether the Coinbase Premium turns higher. And watch whether funding rates stay subdued as ETH-denominated open interest continues to rebuild.
Disclosure: This article was edited by Vivian Nguyen. For more information on how we create and review content, see our Editorial Policy.