I noticed an interesting situation in the market — Bitcoin funding rates have dropped into negative territory, reaching -6%. This is one of the most extreme levels in the past quarter, and such conditions usually signal strong bearish pressure. When rates go negative, a short squeeze becomes a likely scenario because traders holding short positions start paying to maintain them.

What’s interesting — despite this bearish sentiment, open interest in BTC has increased from 668,000 to 687,000 contracts. It turns out that market participants are not leaving but rather adding positions. Over the past 24 hours, more than $500 million positions have been liquidated, with $420 million of those being longs. This indicates volatility and traders rechecking their positions.

According to current data, Bitcoin is trading around $78.8K and recovering after a recent drop to $63K, which was caused by geopolitical factors. Analysts are closely monitoring the dynamics — if a short squeeze really begins, it could lead to a sharp rebound. For now, the market remains in a high-volatility mode, and such extreme funding rates often precede significant movements.