Perpetual futures funding rate hits lowest level since 2022

The annualized funding rate in the perpetual futures market has fallen to its lowest level since 2022, Cointelegraph reported, citing a report from Glassnode. According to Glassnode, the largest-ever wave of forced liquidations has resulted in the most severe leverage reset on record. The firm explained that low funding rates indicate many traders are anticipating a price decline. However, Glassnode also suggested that in situations with extremely low funding rates, such as the current environment, there is potential for a rally driven by a short squeeze. The report added that following the recent market downturn, the recovery has been led by the spot market.