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Fearful Market Shakes Out Little Leverage

Sep 20, 2021 · 4 min read

By Ashwath Balakrishnan

Market Update

Today has been brutal across global financial markets, presumably from fears surrounding China’s real estate market. BTC and ETH were, at one point, trading at $42.5K and $2.9K respectively. The only non-stablecoin in the top 100 that avoided going into the red today was OMG.

An Uncertain Market
Ever since the correction a few weeks ago, funding rates for BTC perpetuals have been slightly depressed. We noted last week that sentiment was fragile, and this is yet another sign of that. Price rebounded a bit from the lows, but funding is still negative. Notably, before the flash crash earlier this month, funding rates were pretty high, which tends to imply an influx of longs levering up. However, this time around, the market was not positioned as aggressively, leading to a slightly brighter outcome.

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