Bitcoin Funding Rates Plunge to Lowest Levels as Experts Say Hope Emerges Only if It Breaks Above "This" Level
Bitcoin Funding Rates Plunge to Lowest Levels as Experts Say Hope Emerges Only if It Breaks Above "This" Level
Bitcoin (BTC), ahead of a massive $2.1 billion options expiry, has seen funding rates plunge to multi-year lows, entering a phase of directional searching amid intense price volatility.
According to cryptocurrency outlet CoinGape on February 6 (local time), Bitcoin retreated intraday to as low as $60,300, signaling unstable price action. However, bargain-buying demand pushed the price back to the $69,300 level, igniting hopes of a rebound. Still, with funding rates—a key indicator in the futures market—falling to their lowest levels since 2023, bearish sentiment among investors has grown dominant. Negative funding rates, in which short-position holders pay fees to long-position holders, suggest that market participants are increasingly positioning for further downside.
This volatility is being amplified by the $2.1 billion Bitcoin options expiry scheduled for later today. While the options market’s put/call ratio stands at 0.60, reflecting earlier optimistic expectations prior to the price drop, the wide gap between the maximum pain price of $80,000 and the current price puts many call options at risk of expiring worthless. Over the past 24 hours, more than $1 billion in positions have been forcibly liquidated, while open interest has also dropped sharply, indicating a rapid unwinding of leverage in the market.
Investor sentiment indicators have also entered a phase of extreme fear, raising expectations of a potential market bottom. The Crypto Fear & Greed Index has fallen to its lowest level in years, and historically such oversold conditions have often preceded major rallies. Meanwhile, a broader recovery across risk asset markets—highlighted by a more than 400-point rebound in the Nasdaq 100 and a 17% surge in Strategy shares—is creating a supportive backdrop for a Bitcoin rebound.
Weekly chart analysis shows the Relative Strength Index (RSI) entering oversold territory for the first time since July 2022, signaling the possibility of a technical rebound. After touching the $60,000 level—the downside target of a rising wedge pattern—Bitcoin formed a hammer candlestick and is attempting a trend reversal. If the weekly close finishes above $69,000, the hammer pattern will be confirmed as a strong rebound signal, potentially laying the groundwork for further upside.
However, the risk remains that the current rebound could prove to be a temporary dead-cat bounce. Market experts warn that unless Bitcoin decisively breaks through the $69,000 resistance level, it could once again turn lower and enter a phase of free fall. Changes in market liquidity following the $2.1 billion options expiry, along with macroeconomic variables, are expected to serve as a critical turning point for Bitcoin’s direction in the first quarter of 2026.
Disclaimer: This article is for investment reference purposes only, and no responsibility is assumed for investment losses incurred based on this information. The content should be interpreted solely for informational purposes.
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