Bitcoin News Today: Bitcoin and Ethereum hit $15B loss in two days amid massive liquidation and negative funding rates

Bitcoin and Ethereum faced a sharp price correction in late July and early August 2025, driven by a massive liquidation wave and a rare inversion of funding rates. Over $15 billion in open interest was wiped out within two days across both assets, signaling a major deleveraging event that erased weeks of futures accumulation [1]. This rapid unwinding was fueled by panic selling and cascading liquidations, exposing the fragility of leveraged positions during periods of heightened volatility [1].

During the event, Ethereum and Bitcoin funding rates on Binance briefly turned negative, with ETH reaching -0.006% and BTC falling to -0.003% on August 1st. These negative rates indicated that short sellers were paying longs to hold positions, a sign of intense bearish pressure and a potential long squeeze [1]. By August 2nd, however, funding rates rebounded, with BTC rising to +0.0042 and ETH to +0.0063, suggesting that the bearish momentum may be subsiding [1].

The ETH/BTC ratio also reflected the relative weakness of Ethereum, dropping from 0.0325 to 0.0307 after a July rally. This shift pointed to a cautious market sentiment, as traders reassessed their exposure between the two leading cryptocurrencies [1]. Liquidation heatmaps further highlighted key resistance zones, with BTC experiencing heavy liquidations near $117,000 and ETH around $3,600. These levels may act as psychological barriers for future price movements, though the absence of significant liquidation bands below current prices suggests that the worst of the deleveraging may have passed [1].

Market analysts have noted early signs of stabilization, as funding rates improve and prices find support. COINOTAG’s analysis suggests that the crypto market may be entering a period of consolidation, with the potential for a recovery if bullish momentum builds [1]. However, traders are advised to monitor key resistance levels and funding rate dynamics closely, as the market remains in a delicate balancing act between bearish pressure and emerging buying interest [1].

The recent corrections were primarily attributed to the rapid liquidation of leveraged longs and the negative funding rate inversion, both of which accelerated the price decline over a short period. While the immediate outlook remains cautious, the rebound in funding rates indicates that market sentiment may be improving, potentially setting the stage for a gradual recovery [1].

Source: [1] Bitcoin Faces Potential Recovery Amid Sharp Liquidations and Funding Rate Rebound (https://en.coinotag.com/bitcoin-faces-potential-recovery-amid-sharp-liquidations-and-funding-rate-rebound/)