Market analysis by BlockBeats suggests a bearish trend in the cryptocurrency market, citing data indicating an increase in funding rates on major exchanges. The accompanying chart reveals current funding rates for prominent cryptocurrencies. 💰
Funding rates, fees set by cryptocurrency platforms to maintain price stability between contracts and underlying assets (typically applied to perpetual contracts), allow long and short traders to swap funds seamlessly without platform charges. They are key to adjusting the cost or profit of holding these contracts so prices remain aligned with asset values.
A funding rate of 0.01% is considered neutral, while an increase above this signifies a bullish market outlook. Conversely, when the rate falls below 0.005%, it reflects a bearish market trend.