Bitcoin drops below $92,000. What signals are being released as the funding rates of mainstream cryptocurrencies turn fully negative?

【Blockchain Rhythm】 The recent cryptocurrency market has experienced a significant correction. Yesterday morning, Bitcoin briefly fell below the $92,000 mark. The shift in market sentiment during this decline was quite obvious — data shows that the funding rates on mainstream CEX and DEX platforms have fully shifted to a bearish stance.

What are the specific signs? Both Bitcoin and Ethereum have shown negative funding rates, which is quite rare in recent times. Even more exaggerated is the altcoin sector, where the bearish sentiment is intense, and the funding rates for mainstream coins have already declined noticeably.

Here’s an explanation of the funding rate mechanism: it is the exchange of funds between long and short traders in perpetual contracts. The exchange sets this rate to balance the contract price with the spot price, essentially adjusting the cost or profit for traders holding positions. A simple rule of thumb is — a funding rate greater than 0.01% indicates a bullish market, while a rate less than 0.005% suggests a bearish market. Based on the current negative funding rates, the market’s short-selling sentiment is overwhelmingly dominant.