Liquidation cascade sends funding rates down to negative territory

Funding rates plummeted deep into negative terrain following the Dec 4th crash but have since recovered into neutral territory.
Source: NYDIG Data

Amid the December 4th crash, funding rates plunged deep into negative terrain as long positions got liquidated in the market, leading to a large price deviation between the perps and the spot market.

During the crash, Deribit’s BTC price fell to $39,977, and the Binance perp reached a bottom of $40,988. Meanwhile, Coinbase reached a low of $42,333. FTX’s perp maintained a far closer peg to the spot market, reaching lows of $41,762.

Link copied to clipboard.