Crypto Funding Rates Neutral Amid Market Recovery
Funding rates on major cryptocurrency exchanges have largely returned to neutral levels following a broad market recovery, according to Coinglass data on January 14. Despite this stabilization, funding rates for Bitcoin (BTC), HYPE, Bitcoin Cash (BCH), and Zcash (ZEC) suggest a lingering bearish sentiment.
Funding rates are crucial for maintaining the balance between contract prices and underlying asset prices, particularly in perpetual contracts. These rates facilitate fund exchanges between long and short traders without the exchange collecting fees. A neutral funding rate indicates market equilibrium, while deviations suggest bullish or bearish trends.
