Over the past 24 hours, the price of $BMNR dropped by 1.664%, and at the same time the funding rate is -0.00068635. This combination directly tells me that the price is falling, but right now shorts are paying fees to longs. The current price is 25.41. Open interest is still around 560,000 and hasn’t contracted sharply along with the price.
My view is very straightforward: $BMNR is currently dominated by shorts, but trading crowding is increasing, and the risk of a short-term rebound is building. My reasoning is based on two signals reinforcing each other. The price drop shows that real sell pressure exists, possibly stemming from caution about the political policy environment behind the underlying asset. But the funding rate being negative means the short camp is so large that it needs to pay to maintain positions—this is a typical sign of overheated bearish sentiment. When consensus is too unanimous, even a small counteracting disturbance can easily trigger a collective cover. Shorts are still paying a negative fee and holding their ground, betting on further downside.
The strongest counterargument would be: as long as the political policy factors driving the decline haven’t changed—for example, regulatory tightening expectations remain the same or related trade policy pressure continues—then the short thesis still holds, and the negative funding rate is merely the holding cost, not a reversal signal. I accept that rebuttal. But my argument depends on the risk inherent in crowding itself. Ongoing negative funding will erode short profits. If the pace of the decline slows, some shorts will leave first to lock in gains, which could trigger a brief mean-reversion pullback.
The second-order effect is this: if the price rebounds, shorts that added at lower levels may face profit takebacks or even floating losses, and forced-liquidation behavior could push the price higher. Meanwhile, investors holding spot or long positions—if they set stop-losses during the recent selloff—they may have already exited, which actually reduces overhead selling pressure. What the market is currently overlooking is the cost differences inside the short camp. Not all shorts entered at the same price. Continued negative funding will force the higher-cost shorts to give up first.
The conditions for my thesis to fail are clear: if $BMNR ’s price continues to break down further, and the funding rate shifts from negative to positive, then it would mean shorts have not only achieved an overwhelming victory, but even longs’ willingness to pay the last bit of fees has vanished—making the downtrend even more solid. I can’t provide a specific invalidation price; I can only judge based on the direction of the funding rate.
Based on the above, my action is to wait. If your current position is short, the cost-effectiveness of adding more is very poor, because you would be paying your counterparty.
Trading tag: #TradFi #链上美股 #BMNR
Where do you think this set of judgments is most likely to be wrong?
My view is very straightforward: $BMNR is currently dominated by shorts, but trading crowding is increasing, and the risk of a short-term rebound is building. My reasoning is based on two signals reinforcing each other. The price drop shows that real sell pressure exists, possibly stemming from caution about the political policy environment behind the underlying asset. But the funding rate being negative means the short camp is so large that it needs to pay to maintain positions—this is a typical sign of overheated bearish sentiment. When consensus is too unanimous, even a small counteracting disturbance can easily trigger a collective cover. Shorts are still paying a negative fee and holding their ground, betting on further downside.
The strongest counterargument would be: as long as the political policy factors driving the decline haven’t changed—for example, regulatory tightening expectations remain the same or related trade policy pressure continues—then the short thesis still holds, and the negative funding rate is merely the holding cost, not a reversal signal. I accept that rebuttal. But my argument depends on the risk inherent in crowding itself. Ongoing negative funding will erode short profits. If the pace of the decline slows, some shorts will leave first to lock in gains, which could trigger a brief mean-reversion pullback.
The second-order effect is this: if the price rebounds, shorts that added at lower levels may face profit takebacks or even floating losses, and forced-liquidation behavior could push the price higher. Meanwhile, investors holding spot or long positions—if they set stop-losses during the recent selloff—they may have already exited, which actually reduces overhead selling pressure. What the market is currently overlooking is the cost differences inside the short camp. Not all shorts entered at the same price. Continued negative funding will force the higher-cost shorts to give up first.
The conditions for my thesis to fail are clear: if $BMNR ’s price continues to break down further, and the funding rate shifts from negative to positive, then it would mean shorts have not only achieved an overwhelming victory, but even longs’ willingness to pay the last bit of fees has vanished—making the downtrend even more solid. I can’t provide a specific invalidation price; I can only judge based on the direction of the funding rate.
Based on the above, my action is to wait. If your current position is short, the cost-effectiveness of adding more is very poor, because you would be paying your counterparty.
Trading tag: #TradFi #链上美股 #BMNR
Where do you think this set of judgments is most likely to be wrong?