Bitcoin traded near $74,700 on Friday morning in Asian markets, with a slight dip of 0.4% in the last 24 hours, yet the leading cryptocurrency posted a notable 3.5% increase over the past week. Global equities, which had seen a strong rally for 10 consecutive days, paused as markets awaited developments on the impending end of the US–Iran ceasefire next week.
Major cryptocurrencies finish the week strong
Ethereum retreated by 1.4% to $2,327, but still led among major coins with a 6% weekly rise. XRP balanced out at $1.43 with a 6.4% gain, Solana climbed 2.7% to $87.67, and BNB advanced 0.7% over the week to $629.89. Dogecoin also stood out, registering a 5.6% jump for the week and trading at $0.0976.
On the global stage, the MSCI World Index slipped 0.1% in Asian trading after closing at a record high on Thursday. The S&P 500 also set a new record. Meanwhile, Brent crude dropped 1.2% to $98.20 after US President Donald Trump commented that a lasting ceasefire with Iran “looked positive.”
Sharp drop in funding rates unsettles investors
Underlying dynamics, particularly Bitcoin’s sideways movements, have caught the attention of professional investors. Recently, funding rates for Bitcoin perpetual futures have turned sharply negative—levels not seen since 2023. Funding involves regular payments to keep futures contracts in line with spot prices and, when rates turn negative, it suggests the market is skewed towards betting on price declines, forcing short-sellers to pay those holding long positions.
ZeroStack CEO Daniel Reis-Faria shared in a note, “The funding rates being this negative indicates an overwhelming short positioning in the market. If Bitcoin manages to rise despite this, a short squeeze could trigger an even faster rally.”
Reis-Faria projected that if pressure on short positions persists, Bitcoin could surge as high as $125,000 within the next 30 to 60 days.
On-chain analysis signals a risky period ahead
On-chain analyst CryptoVizArt highlighted the “True Market Mean” indicator, which filters out coins dormant for extended periods and calculates the average cost for active investors. According to this measure, the average active Bitcoin holder is currently under water.
Historical data since 2016 shows that when Bitcoin trades below this indicator for extended periods, the market experiences significant losses: a 57% maximum drop during the 2018–19 bear market and a 56% drop following the Terra and FTX collapses.
Experts warn that while negative funding rates and a short squeeze could spark a sharp increase, the fact that the average investor is currently losing money means such rallies may face selling pressure. Both dynamics could unfold simultaneously; what matters is whether the unwinding of shorts or underlying structural risks will dominate.
In the days ahead, whether the ceasefire between the US and Iran is extended will play a key role in determining the overall direction of the market.
