Funding rate fell to its lowest level since the bear market bottom in 2022.

Funding rates across the crypto market have just fallen to their lowest level since the bottom of the bear market in 2022. This is seen as one of the most severe “leverage resets” in the history of cryptocurrency, as the wave of liquidation, position closing, and leverage withdrawal spreads across derivatives trading exchanges.

According to analysts, the funding rates falling to extremely low levels reflect the cautious sentiment that is enveloping the entire market. After a period of strong volatility and rapid price crashes, investors have mitigated risk, bringing the market back to a more balanced state. Some experts suggest that this could be a signal of healthy “deleveraging,” paving the way for a new recovery cycle if the spot demand returns.