Analysis: Persistent negative BTC funding rate due to institutional hedging

A persistent negative funding rate in the BTC perpetual futures market, even as the cryptocurrency has rallied 14% in April for its largest monthly gain since April 2025, is being attributed to the structural hedging strategies of institutional investors. According to CoinDesk, 10x Research founder Markus Thielen described the situation as an unusual phenomenon. He pointed out that the 30-day annualized average funding rate stands at -5%, a significant departure from past highs of +8%. Thielen explained that a sustained negative funding rate during a price rally indicates a structural change in the futures market rather than a simple shift in investor sentiment. He elaborated that the market is currently driven by the hedging activities of institutional investors, with hedge funds shorting futures to manage their positions.