Bitcoin Futures Basis and Funding Rate Remain Relatively Stable During Bull RunDespite a nearly 25% surge in Bitcoin's price in September, rising from $53,000 to $66,000, the Bitcoin futures basis and funding rate have remained relatively stable, exhibiting no significant fluctuations. This contrasts with previous price rallies, which typically saw a considerable increase in funding rates and basis
Bitcoin Futures Basis and Funding Rate Remain Relatively Stable During Bull Run
Despite a nearly 25% surge in Bitcoin's price in September, rising from $53,000 to $66,000, the Bitcoin futures basis and funding rate have remained relatively stable, exhibiting no significant fluctuations. This contrasts with previous price rallies, which typically saw a considerable increase in funding rates and basis.
Market Updates:
Historically, increases in Bitcoin spot prices have led to a surge in funding rates for Bitcoin perpetual contracts, as increased leverage demand pushed perpetual contract prices away from the spot price. However, this phenomenon didn't occur during the September rally, with funding rates remaining at a balanced level around 10%.
Bitcoin basis also displayed a similar stable trend, experiencing a brief spike only on September 24-25, before returning to normal levels. This indicates that despite the Bitcoin price surge, the overall capital cost in the cryptocurrency industry hasn't risen significantly.
Trends:
Upcoming Token Unlocks Increase Hedging Demand:
With October approaching, several major token unlocks are scheduled, including SUI, APTOS, and TIA. To navigate these events, venture capital funds, early investors, angel investors, and developers are seeking hedging strategies, locking in prices before liquidity floods the market.
For example, on October 30, TIA will undergo a significant token unlock, releasing 176.56 million tokens, representing 81.94% of its circulating supply. Of these, approximately 65.01 million tokens will be allocated to venture capital funds. As the unlock date approaches, hedging demand continues to rise, reflected in the funding rate for TIA perpetual contracts, which has been consistently negative, sometimes reaching as low as -400%.
Ethena's Staked USDe Yields Stabilize, Funding Rates Remain Steady:
EthenaUSDe is a synthetic dollar uncorrelated to market fluctuations. It complements the staked USDe, a yield-generating "internet bond" based on funding and basis spread differentials. As markets trade sideways, yields are gradually returning to normal levels.
sUSDe generates yield through ETH staking and short perpetual contract positions. Its yield peaked in March when Bitcoin reached historical highs, with funding rates soaring to 70%. Since then, the market has cooled, and ETH funding rates have dropped below 10%. sUSDe yield has also declined from its peak of nearly 50% to just over 10% at the end of September.
Conclusion:
Despite the Bitcoin price surge, Bitcoin futures basis and funding rates have remained relatively stable, indicating no significant increase in leverage demand. Upcoming token unlocks may increase hedging demand, leading to negative funding rates for certain tokens, but overall, the capital cost in the cryptocurrency industry hasn't climbed significantly. Ethena's staked USDe yield has also stabilized, reflecting the general cooling trend in the market.
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