Oct 29, 2025
34 0
Bitcoin Funding Rate Flips Negative, Signals Potential Market Recovery
The Bitcoin market is experiencing notable shifts, impacting both spot and derivatives markets. Key developments include:
- Bitcoin price has been declining, with funding rates also dropping, suggesting the flushing out of long positions from the market.
- Open Interest (OI) has increased, indicating that bears are doubling down rather than bulls being liquidated.
- This setup often preludes a major upward move due to potential short squeezes.
- Despite minimal changes in price action, funding rates, and OI this month, leverage has notably reduced compared to previous months.
Bitcoin Derivatives Market Reset
- A negative funding rate has resulted in a market reset, with leverage flushed out and open interest cooled off.
- Historical patterns suggest that when funding rates flip from negative to positive post-reset, Bitcoin starts gaining momentum.
- Since October 22, funding has been climbing above zero as BTC consolidates, indicating potential for significant movement.
