The Bitcoin funding rate has gone negative for the first time since October 2023.
Jerrmusa.com reports that the negative rate traders pay to start fresh long positions in the permanent futures market highlights the slowdown of Bitcoin demand following a record demand for BTC in March, according to data cited by CryptoQuant.
The price of Bitcoin hit an all-time high of $73,000 in March. But since then, BTC has dropped by about 13%; as of this writing, CoinMarketCap shows that it is currently trading at $63,400.
Bitcoin Net Inflow
Net inflows into spot Bitcoin ETFs have recently declined, according to CryptoQuant. Because miner payouts have decreased due to the Bitcoin halving, traders are less inclined to take long bets.
The waning buyer enthusiasm for Bitcoin can be partly attributed to growing risk aversion brought on by Middle East tensions and anticipated postponements in Federal Reserve rate cuts.
The reduction in daily inflows into U.S. spot Bitcoin ETFs is correlated with the funding rate cut. The spot Bitcoin ETF sector saw a net daily capital outflow of $120.64 million on April 24. Just two cryptocurrency funds saw an increase in funding: the $4.17 million ARK Invest/21 Shares Bitcoin fund and the $5.61 million Fidelity Bitcoin Spot ETF (FBTC).