Categories: Crypto

Bitcoin Rallying But Funding Rate Negative: A Classic and Rare Bull Signal Not to Miss?

Bitcoin price breaks $90,000, but the funding rate on Binance is negative. Will BTC/USD break $100K as traders pour in?

Bitcoin is surging, trading at early March 2025 levels. Impressive as this uptick is, traders on Binance, the world’s largest crypto exchange by client count, aren’t fully on board yet.

On X, one analyst noted that the Binance funding rate remains negative, a marked divergence showing that, despite rising prices, there hasn’t been a massive inflow or FOMO driving demand.

https://twitter.com/Darkfost_Coc/status/1914769908920877448?ref_src=twsrc%5Etfw” target=”_blank” rel=”nofollow

For experienced traders tracking market activity over the past few years, this divergence isn’t just noise. It’s a signal that Bitcoin, and by extension altcoins, may be preparing for a massive rally.

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The Contrarian Catalyst on Binance?

To understand why this is crucial, one must grasp what funding rates are in crypto.

Funding rates are periodic payments between short and long traders in crypto perpetual markets. While they help keep the index close to spot rates, they also gauge sentiment.

When funding rates turn positive, long traders pay sellers, indicating that buying the underlying asset is at a premium. When negative, as is currently the case, sellers pay buyers, pointing to bearish positioning and general skepticism.

Typically, funding rates turn negative when prices fall. However, they are currently negative despite Bitcoin trending higher, breaking above $90,000.

(Source)

This development on Binance suggests traders are skeptical about whether bulls can push prices even higher.

Historically, the analyst notes, skepticism about bullish strength tends to fuel major price rallies and interest in some of the best cryptos to buy. Moreover, such occurrences are rare, based on price data.

Capitalize on Rare Bitcoin Price Signals?

In mid-October 2023 and early September 2024, funding rates turned negative while prices surged, preceding rallies that lifted Bitcoin to fresh highs.

After October 16, 2023, Bitcoin soared from $28,000 to $73,000, and in September 2024, the signal appeared before BTC/USD spiked from $57,000 to $108,000.

(BTCUSDT)

If history repeats, the current Bitcoin price disconnect could set the stage for another vertical breakout.

From the price chart, local resistance lies at the psychological $100,000 mark and the all-time high of $109,000, serving as immediate targets.

There are hints that traders are ready to push prices higher.

On X, an analyst noted that in the past 72 hours, over 57,000 BTC in new positions worth more than $5.3 billion have been opened.

https://twitter.com/AxelAdlerJr/status/1914938736745336840?ref_src=twsrc%5Etfw” target=”_blank” rel=”nofollow

This is the largest liquidity injection in the past year, an indicator that the breakout above $90,000 could be institutionally driven.

Coinciding with this is the expansion in the Bitcoin growth rate, a metric comparing current versus average entry prices.

https://twitter.com/AxelAdlerJr/status/1914965776206905712?ref_src=twsrc%5Etfw” target=”_blank” rel=”nofollow

This velocity of growth indicates aggressive new capital inflows, with speculators willing to pay premiums far above historical averages for exposure.

The spike in this metric suggests Bitcoin may be in the early stages of a bull run that may also help funnel capital to some of the hottest presales in 2025.

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