Key Takeaways

Bitcoin fell near $108k as Funding Rates stayed high on Binance, triggering $477 million long liquidations and raising risks of deeper downside.

Since facing rejection at $117k four days ago, Bitcoin [BTC] slid sharply, falling to a low of $108,717.

As of this writing, Bitcoin traded at $110,197, marking a 2.04% decline over the past 24 hours.

Amid this drop, analysts stayed split on Bitcoin’s prospects. One of them, CryptoQuant’s analyst Arab-Chain, flagged the imbalance between derivatives and spot action on Binance.

Funding Rates reveal the imbalance

According to CryptoQuant, Bitcoin’s Funding Rates on Binance stayed positive throughout August despite the price decline.

Over this period, this metric hovered around 0.005 and 0.008, which are usually considered highly elevated. Typically, positive Funding Rates signal traders kept opening leveraged longs while paying high costs.

Such market behavior reflected considerable optimism, not necessarily driven by strong price fundamentals. 

Naturally, this mismatch hinted at investor belief that the decline was only a temporary correction, keeping optimism alive.

Liquidations start to bite