The CoinGlass Derivatives Risk Index (CDRI) is a market risk indicator developed by the CoinGlass research team, designed to quantify leverage usage, trading sentiment, and systemic liquidation risk in the crypto derivatives market.
CDRI outputs a standardized risk score ranging from 0 to 100, where a higher score indicates a market environment that is increasingly overheated or vulnerable.
By incorporating multiple weighted indicators — including open interest, funding rates, leverage ratios, long-short imbalances, volatility, and liquidation volumes — CDRI offers a real-time snapshot of market risk, suitable for trading risk control, quant strategy design, and product integration.
CDRI (CoinGlass Derivatives Risk Index) is a neutral risk scoring system based on market structure (such as leverage, sentiment, and liquidations), not price trends.
A higher CDRI indicates that the derivatives market has entered an unstable phase, where both long and short positions are exposed to increased liquidation risk.
When CDRI is at a high level, it suggests that leverage is concentrated and sentiment is extreme — the market is in a "high-stakes zone," and price volatility increases.
The likelihood of dual-side liquidations (longs and shorts) becomes significantly higher.
Important:
High risk ≠ Bearish signal. Even during a strong uptrend, as long as structural stress is relieved (e.g., short positions cleared, funding rates normalized), the risk index will decline.
Case Study: February 28, 2024
The CDRI had already surged into the extreme zone (>80), indicating excessive leverage and crowding in sentiment.
Yet Bitcoin broke to a new high, triggering both short squeezes and aggressive long chasing.
This led to a classic dual-side liquidation candle: long wicks both above and below, flushing out longs and shorts.
As short positions were liquidated and leverage unwound, the CDRI dropped rapidly.
The risk index fell not because of a price decline, but because market structure became healthier.
