Cryptocurrency markets kicked off the week with significant volatility as Bitcoin (BTC) slipped to $79,614 during Asian trading hours. After hitting a high of $81,500 on Wednesday, Bitcoin pulled back and recorded a 1.6 percent loss in the last 24 hours. This latest figure mirrors levels last seen at the end of January. Despite the downturn, BTC remains up by 3.3 percent on a weekly basis, according to CryptoAppsy data at the time of publication.
Mixed trends across major cryptocurrencies
Ethereum (ETH) also saw a notable decline, dropping 2 percent to $2,278. Dogecoin (DOGE) was hit even harder, retreating 3.8 percent to $0.1063. XRP lost 1.7 percent, trading at $1.38, while BNB experienced only a minor 0.7 percent slide, finding support around $638. On the other hand, Solana and TRON managed to stay slightly positive, closing at $88.14 and $0.3474 respectively. Weekly charts indicate positive momentum for most major cryptocurrencies, though DOGE stands out as the only major token still in negative territory during this period.
Geopolitical tensions shake the markets
The latest market retreat has been largely attributed to heightened geopolitical tensions. News broke that the US military launched strikes on Iranian targets following attacks on American Navy destroyers. US President Donald Trump described the response as “a light touch,” maintaining that a ceasefire remained in place with Iran. However, Trump also indicated that harsher measures could be taken should Tehran refuse to sign the proposed agreement.
In this tense climate, oil prices also fluctuated. Brent crude climbed 1.2 percent to reach $101, though it remains down over 6 percent for the week. Expectations that the standoff between the US and Iran may cool have continued to weigh on oil with persistent selling pressure.
Funding rates at historic low
BTC futures funding rates have stayed negative for the past 67 days, marking the longest negative stretch in the past decade. K33 Research highlights that negative funding means short sellers are paying long positions to maintain their trades.
With short positions having to pay up for more than two months, analysts note the groundwork is set for a short squeeze. Should this occur, rapidly closing short positions could spark an accelerated price rally for Bitcoin.
Alex Kuptsikevich, chief market analyst at FxPro, said Bitcoin’s sideways price action this week signals a period of consolidation for traders. He noted the daily RSI surpassed 70, indicating overbought territory, and stressed that historically sharp sell-offs follow such moves. Kuptsikevich added that it’s logical for market participants to pause and reassess at this stage since similar patterns have been observed three times before.
Meanwhile, options markets remain cautious. QCP Capital reported that monthly calculated volatility holds around 41 percent, with sustained demand for put options. This trend suggests investors continue to hedge against downside risk even while buying Bitcoin.
Elsewhere, Japanese research firm XWIN pointed to the ongoing price gap on CME futures as a trigger for a potential medium-term BTC target of $93,000. Nonetheless, the report emphasized that this target may not be achieved in a straight line, warning of possible price pullbacks before heading higher.
Currently, the market faces two contrasting forces: Persistently negative funding rates could set off a short squeeze if Bitcoin breaks above $83,200, while geopolitical events and overbought indicators may push prices lower.
