Crypto Market Shows Bearish Sentiment Despite Neutral Funding Rates

According to BlockBeats, recent data from Coinglass indicates that the cryptocurrency market remains neutral but is leaning towards bearish sentiment following a two-day decline. This trend is particularly evident for Bitcoin (BTC), Ethereum (ETH), and Solana (SOL). Funding rates, a mechanism used by cryptocurrency trading platforms to maintain balance between contract prices and asset prices, are currently reflecting this sentiment. These rates are typically applied to perpetual contracts and facilitate the exchange of funds between long and short traders. The trading platforms do not collect these fees; instead, they adjust the cost or yield of holding contracts to keep contract prices close to asset prices. A funding rate of 0.01% is considered the benchmark rate. When the rate exceeds 0.01%, it indicates a generally bullish market sentiment. Conversely, a rate below 0.005% suggests a bearish outlook.