Monero’s futures market is showing signs of growing leverage, with open interest exceeding $300 million as XMR returns above $600. The increase brings the market close to the levels seen before January’s sharp sell-off, raising concerns that another wave of forced liquidations could follow.

The expansion of leveraged positions in Monero (XMR) futures has increased the risk of a sudden and significant price swing.

Monero is a privacy-centric cryptocurrency that obscures transaction details to make tracing transfers difficult. With a market value of approximately $10.9 billion, it is the second-largest privacy coin in the cryptocurrency market.

Data from SoSoValue indicates that the notional value of outstanding Monero futures contracts has climbed above $300 million, approaching the January peak of around $320 million. Futures trading enables investors to speculate on price movements without owning the underlying asset. The $300 million level has been breached only a few times, and every occurrence has taken place this year.

Pseudonymous market analyst Doctor Profit believes the buildup could precede a major liquidation event. The analyst noted that the previous time Monero’s open interest reached a comparable level was in January 2026, before XMR plunged 66% over the following 20 days. Doctor Profit also previously called Bitcoin’s 2025 market top and moved toward an accumulation strategy in July this year.

Open interest provides different insights depending on whether it is measured in dollars or cryptocurrency units. Dollar-based figures reflect the current notional value of outstanding contracts, making comparisons across derivatives markets easier. They can also help indicate the potential scale of liquidations, as forced position closures are generally reported in dollar terms.

Monero’s open interest is rising in coin terms as well. Outstanding futures contracts have increased to 515.73K XMR, marking a five-week high compared with approximately 400K XMR one week earlier.

Liquidations occur when exchanges forcibly close positions that no longer satisfy margin requirements. Through leverage, traders can take positions worth considerably more than their initial deposits, allowing them to amplify potential gains but also exposing them to greater losses.

When prices move in the opposite direction to a trader’s expectations, losses can rapidly consume the available margin. Once the required threshold is breached, exchanges close the position to prevent losses from exceeding the collateral.

Long positions are particularly exposed during market declines because they depend on prices rising. When large numbers of leveraged long positions are liquidated, forced selling can put additional pressure on prices. This may trigger a chain reaction in which falling prices cause further liquidations and accelerate the downward move.

Monero experienced a similar pattern in January. Open interest reached a record as XMR prices climbed, suggesting that bullish positions had become increasingly crowded. The cryptocurrency reached nearly $790 on Jan. 14 before dropping below $300 during the first week of February. Coinglass data showed that the decline included several million dollars in long-position liquidations.

The current rally has revived comparisons with that period. Monero has moved above $600 while open interest continues to increase, bringing its price to the highest level since January.

However, the similarities do not necessarily mean another crash is approaching. The risk of a liquidation cascade will depend on future price movements, the distribution of leveraged positions and whether traders begin reducing their exposure.