Bitcoin's price has surged approximately 14% this month, reaching $78,127.13, yet the perpetual futures market is showing a negative funding rate, indicating a divergence from the spot market. This anomaly is attributed to institutional hedging rather than a lack of confidence in Bitcoin's rally. Markus Thielen of 10x Research suggests that the negative funding rate reflects structural changes due to increased institutional participation. The 30-day average funding rate is currently at negative 5%, a significant deviation from the historical norm of positive 8%. Thielen identifies three main sources of short pressure: hedge fund redemptions, institutional trades involving Strategy (MSTR) shares, and Bitcoin miners pivoting to AI. These activities involve shorting Bitcoin futures as a hedge, representing risk management strategies rather than bearish sentiment.
Bitcoin Futures Funding Rate Turns Negative Amid Institutional Hedging
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