.jpg)
Bitcoin (Bitcoin) A 14% weekly correction after crossing the $100,000 threshold does not invalidate the possibility of further upside as key price metrics decline, according to the latest edition of “Bitfinex alpha” a report.
The correction wiped out more than $1.1 billion across centralized exchanges, of which $815 million involved long positions, including $419 million directly tied to Bitcoin. This represents one of the largest dollar liquidations since the FTX crash in November 2022 and the second largest event for Bitcoin-related trading pairs.
Nearly 4,350 BTC were liquidated in one day, the fourth highest daily number since 2019. Bitfinex attributes this series of liquidations to profit-taking by long-term holders (LTHs), which slowed their distribution rate following the price surprise. . He falls.
Realized profit (RP), a key metric for tracking dollar gains from transferred currencies, peaked at $10.5 billion per day during Bitcoin’s surge to $100,000. This number has since dropped to $2.5 billion per day, a 76% decrease.
The sharp decline in RP indicates that profit taking has eased significantly, reducing sell-side pressure and enabling Bitcoin to settle at a new all-time high.
Bitfinex notes that this cooling-off period may allow Bitcoin price to establish a new equilibrium, with fewer flash sell-offs expected in the near term.
Stable financing rates
Futures funding rates, which rose during the rally, are also beginning to stabilize. On December 5th, the day Bitcoin reached its recent price highs, funding rates on Bitcoin and Ethereum (Ethereum) has temporarily exceeded 80-100% of the Annual Percentage Rate (APR), indicating a significant level of leveraged long positions.
Smaller altcoins, such as Dogecoin (Doug) and baby (baby), and saw higher financing rates, exceeding 200% APR.
However, after the recent correction, funding rates are back to less than 30% APR for altcoins and less than 15% for Bitcoin and Ethereum. This decrease indicates a decrease in excessive leverage and indicates that the market is moving toward greater stability.
Furthermore, Bitfinex predicts that the $100,000 level will no longer be an important support or resistance level as the market finds a new equilibrium.
The report confirms that a further decline in financing rates would indicate the continued unwinding of leveraged positions, paving the way for a more balanced market. Conversely, any re-acceleration in financing rates could signal renewed speculative demand, which could reignite upward momentum.
As selling pressure subsides and speculative demand stabilizes, Bitfinex maintains an optimistic medium-term outlook for Bitcoin. The coming weeks will determine whether Bitcoin’s consolidation above $100,000 can provide a stable foundation for further growth.
