Shiba Inu (SHIB) futures open interest plunged 25 percent over the past 24 hours. After raising hopes of a rebound on a sharp price jump, Shiba Inu turned lower within a day, and enthusiasm among derivatives investors appears to be cooling quickly.

On July 27 (local time), blockchain media outlet U.Today reported that CoinGlass data showed open interest in the Shiba Inu futures market fell sharply over 24 hours.

Shiba Inu rose steeply in the previous session, showing one of its strongest daily performances in recent months. During the parabolic rise, the price climbed to around $0.0000057 at one point.

The momentum did not last long. As market sentiment quickly reversed, traders reduced their exposure to the futures market and open interest fell to about 10.13 trillion SHIB. The price also traded around $0.0000050 as of July 27, down more than 7 percent. That amounts to cooling signals in both spot and derivatives markets.

The decline drew more attention because Shiba Inu surged more than 35 percent just a day earlier. At the time, it reclaimed a price level it had failed to break over the past two months, posted a bigger gain than other cryptocurrencies, and climbed to 25th by market capitalisation. But buying did not persist after the spike and sentiment turned bearish again. The drop in open interest suggests some traders may have taken profits after the rally or that leveraged positions were liquidated during the price reversal.

Still, it is difficult to conclude there will be further declines based on open interest alone. It can also be seen as a sign that excessive leverage in the derivatives market has been unwound, so if the price holds support and open interest rises again, it could be interpreted as a signal of fresh buying demand.

The move shows the funds that supported Shiba Inu's short-term rebound lacked staying power. Futures market participation fell quickly after the price jump and the spot price also retreated within a day, heightening investors' caution. Key points to watch are whether money that left the futures market after the surge returns and whether Shiba Inu can hold the price level it recently reclaimed. If the price rebounds without a recovery in open interest, the durability of the uptrend is still likely to remain in question.