As a seasoned analyst with over two decades of experience in both traditional and digital markets, I find the current state of Bitcoin intriguing. Based on my analysis of the funding rate and market trends, it appears that we are still in the early stages of a potential parabolic phase for Bitcoin.
The Bitcoin funding rate signals that the market is not overly frothy and shows no signs of Bitcoin’s price peaking too early in the cycle, according to a crypto analyst.
By examining the funding rate using a 30-day exponential moving average, Avocado from CryptoQuant notes that there appear to be no indications of late-cycle overheating as of the Dec. 17 market report.
Bitcoin’s upward trend ‘likely to continue,’ says analyst
As an analyst, I can affirm that the current trend suggests a continued increase in Bitcoin’s value, with ample potential for additional expansion.
Anonymously trading cryptocurrencies, Rekt Capital expressed in a recent Reddit post on December 17th that “Bitcoin is merely starting its steep upward trend in this market cycle.
Rekt claimed that this phase typically lasts 300 days, but it’s only on “day 41” so far.
According to CoinGlass data, the funding rate for Bitcoin (BTC) on Binance – the leading cryptocurrency exchange in terms of trading volume – currently stands at 0.0084%. This rate, known as the payment system that keeps trading balanced by adjusting futures and spot market prices, is in effect now.
In a market primarily controlled by buyers, they might have to compensate sellers with a charge (or positive funding rate) to keep their holdings. Conversely, in a market where sellers are dominant, the sellers would actually be paying the buyers (with a negative funding rate).
In August, as Bitcoin dipped below $60,000, the funding rate on Binance reached its lowest points for the entire year, suggesting a noticeable change in market opinions.
‘Not overheated at all,’ says trader
In a recent post on Reddit, an anonymous cryptocurrency trader known as Mister Crypto expressed his view that the funding rates for Bitcoin have yet to reach a heated level.
They stated that they intend to raise the price further, as long as it stays below 1%, following Bitcoin reaching an unprecedented peak of $108,239 on December 17, based on information from CoinMarketCap.
During the span from March to October, Avocado noted that both the future and spot Bitcoin markets exhibited a lengthy phase of decreased trading action, coinciding with Bitcoin’s price remaining stable within a broad band of $53,000 to $72,000.
Nevertheless, starting in October, trade activity has surged in both markets at the same time, fueling a rising trend for Bitcoin’s price,” Avocado noted.
2025 may see brief drops in Bitcoin prices according to Bitfinex analysts, as they anticipate robust institutional interest keeping prices steady.
Analysts believe that any necessary adjustments in 2025 are likely to be minor due to ongoing institutional investments.
According to experts at Bitfinex, it’s possible that the price of Bitcoin could climb as high as $145,000 by mid-year 2025. If everything goes well and conditions are ideal, this digital currency might even surge up to $200,000.
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2024-12-18 08:48