Bitcoin Funding Rates Don Turn Bearish for Major CEXs & DEXs
For September 3, Coinglass data show say Bitcoin funding rates for major centralized exchanges (CEXs) and decentralized exchanges (DEXs) don enter bearish zone. Ethereum funding rates self don drop, dem dey below the industry baseline of 0.01% and even go under 0.005%, wey mean say derivatives traders dey very bearish. Funding rates na periodic payments between long and short positions for perpetual swap contracts, dem dey help make sure contract prices align with spot markets. The current low funding rates show say short-side pressure dey rise as traders dey price in downside risk for BTC and ETH. This bearish trend inside Bitcoin and Ethereum funding rates mean say market outlook cautious, people dey prefer downside protection instead of upside chances. Traders suppose watch funding rate trends well well, because if rates stay low for long, price fit weaken more for short to medium term.
Bearish
Funding rates na be key sentiment indicator for derivatives markets. Historically, negative or low funding rates don usually happen when bearish momentum high and prices dey fall for big cryptocurrencies. For example, for June 2022, funding rates for BTC and ETH drop below zero before market fall more than 20%. The recent change where Bitcoin and Ethereum funding rates drop below 0.005% mean say traders dey put more short-side bets, expect say price go still go down. For short term, dis one fit make volatility and price dey move down faster because funding cost dey encourage short position. For long term, if negative funding last longer, e fit create oversold condition, fit attract bargain hunters once sentiment stable. But if bearish sentiment continue steady, e fit spoil market stability and extend any correction. Traders suppose dey watch funding rate trends along with other indicators like open interest and spot volume to sabi how strong and how long this bearish bias fit last.