Since mid-March of this year, Bitcoin (BTC) has been in a downtrend that seems impossible to break out of. In fact, the price of Bitcoin is so high that even major institutions are slowly losing confidence. The number of short positions has also increased, which may indicate that BTC is not yet ready for a price increase.
BTC funding rate is negative
One of those negative signals is related to the funding rate. That’s why we look at the futures market. From the data from Cryptoquant It appears that there has been a negative funding rate for three days in a row. This has only happened before in October 2023. A negative funding rate means that there are more traders selling (bearish) than selling (bullish). This may indicate that traders are expecting further price declines.
BTC has been consolidating for several months.
At the beginning of this week, it looked like Bitcoin would continue to rise after falling from $62,500 to $57,500 last week. But after Bitcoin touched $62,000, the chart turned red again and the price dropped to $56,000 on Thursday, August 15. This drop comes as part of a sideways price movement that began in early March.
Investors are now wondering whether this is the beginning of a larger correction, or whether the price is just consolidating before a major price surge occurs. Therefore, the coming months are crucial for the bull market, as more and more negative signals are coming.
Bitcoin ETF Flow Positive
In contrast to the negative funding rate, capital flows into BTC ETFs have turned positive. This is evident from data from SosvalioFor example, the ETF ended August 15 with net inflows of $11.11 million. This was despite an inflow of capital from the Grayscale Bitcoin Trust (GBTC).
Despite the fact that the funding rate is negative, many parties also view the BTC price positively. Major investors still consider BTC a good investment and capital continues to flow through ETFs. So the question is whether the negative funding rate will overcome the positive capital flows.
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