The Binance Bitcoin Funding Rates metric has emerged as a vital tool for analyzing Bitcoin’s market trends. According to CryptoQuant’s verified analyst Burak Kesmeci, examining funding rates during the 2020-2021 bull run reveals patterns that could guide today’s market behavior. Let’s explore the key phases of past bull cycles and how they relate to the current market.
Phase 1: July 2020 – The Calm Before the Storm
In mid-2020, Binance Bitcoin Funding Rates remained stable at 0.01 for weeks. This period marked a sense of calm in the market, which was followed by a surge in demand for Bitcoin.
The price climbed rapidly from $9,000 to $12,000, and funding rates spiked to 0.10, signaling a bullish shift in market sentiment.
Phase 2: November 2020 – A Rally and Correction
As Bitcoin consolidated in the $12,000 range, funding rates briefly turned negative before flipping positive, reaching 0.08. This movement was a precursor to Bitcoin’s climb to $19,000, showcasing how fluctuations in funding rates align with market corrections and subsequent rallies.
Phase 3: December 2020 – Breaking New Highs
By December 16, 2020, Bitcoin surpassed its previous highs and maintained a strong upward trajectory.
Funding rates reached 0.17 during this phase and remained elevated around 0.10 as Bitcoin’s price soared above $60,000. This sustained high funding rate reflected strong market confidence and demand.
The Current Market Situation
Currently, Binance Bitcoin Funding Rates sit at 0.01, a typical level for the early stages of a bull market. Based on historical patterns, Burak Kesmeci suggests that the market may have already completed the first two phases of the current bull cycle.
The next critical indicator will be whether funding rates exceed the 0.01 mark, signaling the potential onset of the third phase.
Why This Metric Matters?
The Binance Bitcoin Funding Rates metric provides valuable insights into market dynamics. With Bitcoin’s price currently at $104,405, reflecting a nearly 2% drop in a single day, this metric becomes a crucial tool for understanding the next potential movement of Bitcoin.
