A positive funding rate indicates that the long traders (investors with buy positions) are paying a fee to short traders (investors with sell positions). This trend of the periodic fee signals the prevalence of a bullish sentiment in the crypto market.
According to Kesmeci, an in-depth evaluation of Binance’s Bitcoin funding rates over the past 30 days shows a clear correlation with the short-term price movement. When funding rates turned positive, the price of BTC typically experienced notable increases in the short term.
In the second period — between May 6 and May 10, the funding rates once again entered into positive territory, with the Bitcoin price jumping from $95,000 to $103,000 during this time. According to Kesmeci, the funding rates on Binance — the world’s largest exchange by trading volume — remain pivotal to the BTC price trajectory.
As of this writing, the price of BTC stands at around $103,605, reflecting a 0.5% jump in the past 24 hours.
