Bitcoin Bears Dominate Futures Market as Funding Rate Turns Negative—What Could Happen Next?

Bitcoin continues to consolidate amid uncertainties, but funding rates have turned negative, revealing the behavior of a chunk of market traders.

The Bitcoin price range between $62,000 and $66,000 has come with a noticeable shift in derivatives positioning, with futures data showing sellers still firmly in control. Yet beneath the surface, some metrics that typically appear near market bottoms are reemerging, raising the question of whether the current price action could ultimately set the stage for a price recovery.

Key Points

• Bitcoin continues to consolidate amid uncertainties, but funding rates across Bitcoin futures platforms have stayed deeply negative while its price hovers around the mid-$60,000s.
• When funding rates remain below zero for extended periods, it usually means participants are aggressively positioning for lower prices.
• This contrasts sharply with the previous major bottom near $80,000 in November 2025, when funding rates were positive.
• The BTC futures market had operated with elevated leverage for 16 months, particularly during the run toward Bitcoin’s last all-time high.
• However, repeated price pullbacks have triggered liquidations and reduced appetite for leverage, which is good for Bitcoin in the long term.

Negative Bitcoin Funding Shows Persistent Selling Pressure

According to verified CryptoQuant analyst Gaah, funding rates across Bitcoin futures platforms have remained deeply negative while its price hovers around the mid-$60,000s. That imbalance signals that short positions are paying longs, a structure that tends to form when sentiment is heavily tilted toward further downside.

Notably, funding rates serve as indicators for derivatives markets. When they remain below zero for extended periods, it usually means participants are aggressively positioning for lower prices.

Gaah noted that the dominant force since July 2025 has been steady selling. Buy-side limit orders have mostly served to absorb supply rather than meaningfully push prices higher. In other words, demand has been to defend key support levels rather than to catalyze a sustainable rebound.

Interestingly, this contrasts sharply with the previous major bottom near $80,000 in November 2025, when funding rates were positive. Back then, traders were still optimistic that BTC would shake off setbacks and target higher prices. Today, the sentiment is the opposite, with pessimism reflected in the skew of futures positions.

Selling pressure is also at its strongest level in three months, reinforcing the idea that the market is still working through excess supply. Bitcoin holders often face severe portfolio drawdown in such market phases, as prices persistently crumble.

Leverage Reset Healthy in the Long Term

The CryptoQuant analysis also highlighted that the BTC futures market had operated with elevated leverage for 16 months, particularly during the run toward Bitcoin’s last all-time high of $126,200 in October 2025. Since then, repeated price pullbacks have triggered liquidations and reduced appetite for leverage.

While price declines that trigger capitulation events may look destructive on the surface, they also flush out overleveraged positions. As leverage falls, the market becomes less vulnerable to sharp liquidation spikes during dips.

Gaah argues that this reset is constructive in the long term. With weaker hands pushed out and leverage cooling, the structure can gradually stabilize. Historically, this market phase has often preceded more sustainable Bitcoin recoveries.

In the meantime, the argument of when and where Bitcoin will bottom continues to dominate discussions. While this remains uncertain, technical analysis identifies the $60,000 support and $67,000 resistance as levels to watch depending on where the asset tilts in the near term.