All articles tagged with #funding rates
As Q3 begins, XRP shows potential for a comeback and could challenge Ethereum's dominance, with both cryptocurrencies experiencing elevated funding rates and bullish futures market sentiment, though the true driver of recent rallies—spot demand or capital rotation—remains uncertain.
Altcoin funding rates have reached a 9-month high, driven by significant leverage, raising concerns about potential long liquidations. Despite impressive gains by altcoins like Hedera, XRP, and Cardano, the high funding rates of 4%-6% per month could erode margins if prices stagnate or decline. This situation is exacerbated by tight liquidity, as most market focus remains on Bitcoin, potentially leading to a long-liquidation cascade if short-sellers dominate. Investors are advised to remain cautious amid ongoing volatility and potential market corrections.
Bitcoin's sharp pullback from its record high of $69,000 has led to a normalization of funding rates in the crypto perpetual futures market, with the annualized funding rates for the top 25 cryptocurrencies dropping to less than 20%. This pullback has cleared excess leverage from the market, potentially signaling a cooling period in the coming weeks. The correction forced the closure of $1 billion worth of leveraged perpetual futures bets across digital asset markets, and the market could continue to deleverage, potentially pushing bitcoin's price back to $40,000, according to one observer.
Bitcoin's 4% drop to $42,000 has cooled the overheated crypto perpetual futures market, as funding rates for major cryptocurrencies have receded to a healthy territory below 0.1%. The decline in futures open interest suggests that overleveraged traders have been shaken out of the market, causing a minor bullish/bearish hiccup.
Bitcoin and Ether prices remain stable below their 20-day moving average, with funding rates on perpetual futures remaining positive, indicating bullish sentiment. Trading volumes will be key to watch, as they could amplify or mute any directional move. Bid/ask spreads are wide, especially after some market makers quit crypto. In traditional finance, stock-market action was muted as traders try to handicap the odds of whether U.S. lawmakers can agree on a plan to avoid a default by the federal government.