Bitcoin Stalls at $70K as Bears Dominate Amid Negative Funding
Key Insights on Bitcoin Market Dynamics
Bitcoin futures funding rates dipped into negative territory for a short period, highlighting a reluctance among optimistic traders to employ leverage aggressively at this juncture.
Growing doubts about the extended-term returns from artificial intelligence ventures have driven capital flows toward traditional safe havens like gold and United States Treasury bonds.
On Tuesday, Bitcoin struggled to surpass the $70,000 threshold after a pullback in S&P 500 futures contracts. Market participants expressed worries that artificial intelligence-related investments might require more time to deliver substantial profits, which in turn weighed heavily on the stock prices of major technology firms such as Nvidia, Apple, and Google during Friday’s trading session. This sentiment spilled over into Bitcoin futures, where bearish pressures mounted, prompting fears of additional price declines ahead.
Bitcoin futures annualized funding rate. Source: Laevitas.ch
The annualized funding rate for Bitcoin futures turned negative momentarily on Monday, underscoring diminished appetite for leveraged bullish positions. In typical neutral market environments, this key metric hovers between 6% and 12%; thus, the prevailing lack of enthusiasm from bullish traders has characterized the market over the last seven days. Furthermore, the surging popularity of precious metals has compounded the frustrations experienced by Bitcoin holders seeking price appreciation.
Bitcoin/USD versus silver, gold, and S&P 500 futures. Source: TradingView
Over the preceding two months, silver and gold have outperformed significantly, even as equity markets shifted into a phase of sideways consolidation. Momentum in the technology sector has stalled, with analysts divided: some contend that current valuations are overstretched, while others posit that artificial intelligence-driven efficiency improvements are beginning to materialize. Irrespective of these debates, investors have increasingly turned to United States government bonds as a defensive measure against potential volatility.
US dollar strength index (left) versus US 10-year Treasury yield (right). Source: TradingView
Yields on the benchmark 10-year United States Treasury notes fell to their lowest points since November 2025, a clear indication of heightened demand for these securities. This development does not inherently signal stronger faith in the Federal Reserve’s ability to navigate economic challenges by preventing a downturn without igniting inflationary pressures. On the contrary, the United States dollar has lost ground relative to a broad basket of international currencies, as evidenced by the declining DXY index.
Dario Amodei, who serves as co-founder and chief executive officer of Anthropic, indicated on Friday that substantial returns from artificial intelligence expenditures are improbable within the coming few years. He cautioned that the rapid construction of expansive data centers through massive capital outlays could prove financially devastating.
Amodei further emphasized that achieving $10 trillion in computational capacity by the middle of 2027 remains unfeasible owing to persistent limitations in infrastructure and supply chains. Such pronouncements have fostered a climate of hesitation within the technology industry, encouraging investors to adopt more conservative positions amid the prevailing ambiguity.
Bitcoin Options Market Finds Equilibrium Amid Ongoing Macroeconomic Concerns
Interest in strategies leaning neutral or bearish within the Bitcoin options arena has plateaued throughout the past week. The sharp sell-off that drove prices to $60,200 on February 6 generated widespread alarm at the time, but that initial frenzy has since dissipated considerably. Nevertheless, sentiment remains distant from outright bullish territory.
Deribit BTC put-to-call options ratio. Source: Laevitas.ch
At Deribit, the put-to-call ratio for Bitcoin options registered at 0.8x on Monday, reflecting an even split in trading volume between put options (which bet on price declines) and call options (which anticipate price increases). This figure marks a notable departure from the 1.5x reading observed on Wednesday, which had signaled pronounced bearish inclinations. Although it may require several weeks for bullish forces to restore complete dominance, current readings from Bitcoin derivatives markets reveal no evidence of widespread panic among traders.
Market participants appear to have embraced a prudent approach, securing profits after Bitcoin briefly approached the $70,000 level. This wariness intensified due to holiday closures in both United States and Chinese financial markets on Monday, limiting overall trading activity. Negative funding rates in Bitcoin futures alone do not conclusively predict deeper price corrections. That said, fostering lasting upward price momentum will probably hinge on a broader easing of macroeconomic tensions and clearer signals from global economic indicators.
