Crypto analytics firm Santiment is warning that Bitcoin's (BTC) funding rate may be on the verge of turning negative and indicating a market downtrend. The funding rate is based on the difference between the perpetual contract market and the spot price, with traders having to perform periodic payments in order to maintain it. Santiment recorded an overall bearish signal after zooming in on Bitcoin's funding rate on the major platform Binance, where the traders have been consistently long over the past month. Prices historically move in the opposite direction of funding rates, hence prompting for some concern.

Santiment also pointed to social media trends that are often used to try and predict Bitcoin's price action. The trend of the past five weeks indicates that traders have become less optimistic towards top crypto assets, suggesting the probability of continued price rises. Regarding discussions on social media platforms, they are declining in general, meaning the crowd is uncertain on what to think and believe.

At the time of writing, Bitcoin's price was recorded at $28,293, down 2.9% over the last 24 hours. The data gathered by Santiment can be used to inform users when taking their investments and trading decisions, however, it is not professional financial advice, and should not be taken as such.



Other News from Today