Assessing the Resilience of Long-Term Bullish Whales Amid Rising Funding Fees in Perpetual Futures Markets

The cryptocurrency perpetual futures market has become a battleground for high-stakes speculation, where bullish whales-large traders with significant capital-navigate the dual challenges of rising funding fees and extreme volatility. As funding rates, which periodically rebalance perpetual futures prices to align with spot prices, have surged in 2023–2025, the sustainability of high-leverage long positions has come under intense scrutiny. This analysis explores how bullish whales adapt to these pressures, leveraging risk management strategies and market insights to maintain their positions, while also highlighting the systemic risks inherent in leveraged trading.

Funding Fees and Market Dynamics

Funding rates in perpetual futures markets have shown a weak but statistically significant correlation with price movements, particularly over 7-day intervals, with funding rate changes accounting for 12.5% of price variation. However, their predictive power wanes over longer periods, underscoring their limited utility for individual asset forecasting. Instead, funding rates serve as a barometer of market sentiment: positive rates signal bullish positioning, while negative rates reflect bearish bias. During high-volatility periods, such as mid-2023 and early 2024, funding rate fluctuations intensified, amplifying trading costs and liquidity dynamics.

For high-leverage long positions, elevated funding rates act as a double-edged sword. When bullish sentiment drives positive funding rates, long holders pay fees to shorts, eroding profitability over time. For example, Bitcoin's funding rate surged from 0.04% to 0.09% during a 2024 bull run, reflecting strong long positioning but also signaling risks of overleveraging and subsequent corrections. Conversely, negative funding rates can benefit longs by allowing them to collect fees from shorts. Yet, in highly leveraged environments, such as on platforms like Hyperliquid, imbalances in open interest can trigger cascading liquidations, as seen in the December 2024 flash crash and July 2025 short squeeze.

Whale Strategies: Navigating Volatility and Funding Costs

Bullish whales employ sophisticated tactics to sustain high-leverage positions amid rising funding fees. One such strategy is "interest-bearing bottom-fishing," where traders hold cash and sell put options for longer-term contracts to accumulate assets at favorable prices. This approach allows whales to hedge against funding costs while capitalizing on market dips. Additionally, forecasting volatility through whale transaction analysis has become critical. Research indicates that whale activity can predict Bitcoin volatility spikes, enabling traders to adjust leverage and position sizes accordingly.

Another key technique involves dynamic rebalancing of leverage ratios. By adjusting leverage in response to funding rate trends, whales can mitigate erosion from fees. For instance, during periods of elevated funding rates, reducing leverage or shifting to lower-fee assets can preserve capital. This flexibility is evident in the case of a Hyperliquid whale who, as of September 2025, held a 5x leveraged long on 1,000 Bitcoin and a 10x leveraged long on Solana, demonstrating a nuanced understanding of market timing and asset-specific risk profiles.

Case Studies: Lessons from the Front Lines

The resilience of bullish whales is best illustrated through real-world examples. A notable case involves a Hyperliquid whale who accumulated a $40 million unrealized profit through aggressive 5x and 10x leveraged positions in Bitcoin, Ethereum, and Solana. This whale's strategy, which included entering positions during strategic market lulls and exiting ahead of volatility spikes, highlights the importance of timing and risk discipline. However, the same whale faced scrutiny during a $2.1 billion liquidation event in October 2024, underscoring the fragility of leveraged positions during systemic shocks.

Systemic risks were further exposed in October 2025, when $1.5 billion in leveraged long positions were liquidated within 24 hours, triggering a 46% spike in futures setups. This event, coupled with record open interest levels of $220.37 billion in Q3 2025, revealed the precarious balance between leverage and liquidity in crypto markets. Regulatory interventions in DeFi also added complexity, as governance tokens became more sensitive to policy signals, indirectly influencing leveraged trading strategies.

Conclusion: Balancing Ambition and Prudence

The sustainability of high-leverage long positions in crypto perpetual futures hinges on a delicate interplay between funding rate dynamics, volatility management, and strategic adaptability. While bullish whales have demonstrated resilience through techniques like interest-bearing bottom-fishing and dynamic leverage adjustments, the risks of cascading liquidations and regulatory uncertainty remain significant. For investors, the key takeaway is clear: leveraging high-stakes positions requires not only market insight but also robust risk management frameworks. As the crypto market evolves, the ability to navigate funding fee volatility will separate the resilient from the reckless.