- Crypto market sees continued pullback with rising liquidations
- Traders go risk-off as funding rates turn negative
- BTC and ETH ETFs show institutional inflows for second day
The crypto market experienced another wave of selling pressure, with Bitcoin ( BTC ) and Ethereum ( ETH ) both posting losses. Bitcoin dropped 0.7% to $113,438, while Ethereum declined by 2.3% to $4,029. The Fear and Greed Index (FGI) slid to 51, putting market sentiment firmly in the “Neutral” zone.
The broader market cap now stands at $4.05 trillion, reflecting a cautious tone across digital assets. More than $506 million in leveraged positions were liquidated over the past 24 hours, highlighting how volatile conditions have caught many traders off guard.
Negative Funding Rates Signal Shift in Sentiment
A key driver of the current crypto market pullback is the shift in perpetual futures funding rates. These have turned negative, suggesting that traders are now paying to remain in short positions. This typically reflects growing bearish sentiment or a hedging move in response to recent price surges.
When funding turns negative, it’s often a signal that the market is cooling off after an overextended rally. While short-term price pressure may continue, some analysts view this as a healthy reset that clears excess leverage from the system.
ETF Inflows Hint at Institutional Confidence
Despite the near-term sell-off, institutional interest remains strong. Both Bitcoin and Ethereum exchange-traded funds (ETFs) recorded two consecutive days of inflows. This is a significant development, as ETF flows are considered a reliable gauge of long-term investor sentiment.
ETF inflows often reflect confidence from institutional players who prefer regulated investment vehicles over direct crypto exposure. Their continued interest—despite market volatility—could be an early sign that the recent pullback is seen as a buying opportunity rather than a signal of deeper weakness.
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