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Crypto Potato 2025-01-20 15:48:22

Bitcoin Futures Funding Rate Surges Amid Trump-Driven $109K ATH Rally

Bitcoin’s Futures Perpetual Funding Rate has surged to 0.035%, its highest since December 5, indicating heightened speculative interest. This trend has come as Bitcoin hit a new peak of over $109,000 on Monday, just hours ahead of Donald Trump’s presidential inauguration. The funding rate briefly turned negative earlier this month when Bitcoin was trading near $94,000, likely forming a local bottom. Heightened Speculation A positive funding rat e means that long traders periodically pay short traders, while a negative rate indicates the reverse. In bullish market conditions, Bitcoin typically maintains a positive funding rate as traders anticipate continued price increases. However, excessive optimism can lead to an overheated market, causing price reversals and widespread liquidations. But accumulation trends indicate there’s more room for growth. As Bitcoin touched a record high above $109,000, Glassnode also revealed that the Long-Term Holder Net Unrealized Profit/Loss (NUPL) surpassed 0.75, thereby signaling market euphoria and greed. Additionally, Short-Term Holder (STH) profitability also regained momentum, with Bitcoin’s STH MVRV rising to 1.16, exceeding the 1-year trendline of 1.1. Meanwhile, Ecoinometrics projected a cautiously optimistic outlook for Bitcoin. It said that the crypto asset has a 54% probability of achieving more than 10% returns over the next month, supported by a mildly bullish market sentiment. Although reaching $150,000 by 2025 is challenging, current trends favor continued upward movement. Key catalysts for sustaining this trend include steady institutional investments via ETFs and a favorable outcome from the Federal Reserve’s upcoming policy decision. Investor Optimism and Policy Speculation Bitcoin recording a new ATH was accompanied by rapid gains in other cryptocurrencies, as investors speculated on potential policy shifts and regulatory changes tied to the US presidential inauguration. Optimism surrounding the US economy’s long-term strength has further boosted sentiment. Meanwhile, Min Jung, a research analyst at Presto Research, noted rumors of a leaked inauguration speech hinting at a potential Bitcoin strategic reserve, though this remains unverified. Speculation and anticipation around Trump’s inauguration continue to drive market activity. The post Bitcoin Futures Funding Rate Surges Amid Trump-Driven $109K ATH Rally appeared first on CryptoPotato .

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