Bearish traders have taken firm control of the Bitcoin derivatives market, with selling pressure reaching its highest level in three months. According to on-chain analytics data, Bitcoin's funding rates have plunged deeply into negative territory, reflecting persistent downside sentiment among futures traders. This bearish dominance has been in place since July 2025, with aggressive sell orders consistently outweighing buy activity across the market.
The current price of Bitcoin, hovering between $62,000 and $68,000, represents a significant decline from its previous local bottom near the $80,000 level. At that earlier peak, funding rates were largely positive, indicating stronger long positioning. The massive shift in market sentiment has fundamentally altered the market structure, with bearish conviction overpowering bullish attempts despite brief signs of recovery.
Analysts point to a "leverage reset" occurring in the market. Charts reveal that the futures market operated under elevated leverage for approximately 16 months, but since Bitcoin's last all-time high, this excessive leverage has been steadily unwinding. The recent wave of price declines has forced liquidations and capitulation among overleveraged traders, contributing to this market correction.
Amid the broad awakening of bearish traders, Bitcoin's Open Interest (OI) had been declining over recent months. However, the crypto market is showing signs of a broad resurgence that has extended to derivatives. Bitcoin's open interest recorded a mild increase of 1.48% over the last 24 hours, with traders on the CME exchange showing particular interest—the asset's open interest on CME surged by 6.61% during the same period.
