The US Federal Reserve’s public consideration of reducing interest rate cuts in 2025 has had many negative effects on financial markets. In addition to a 17% price loss for Bitcoin, data from the Binance exchange shows that the BTC market has now developed its largest spot and perpetual price gap.
Bitcoin Spot-Perpetual Gap Falls to -$59 – What Next?
Last week, the Fed announced a potential reduction of the four rate cuts originally planned in 2025 to two, triggering a sell-off in global financial markets. As the total crypto market cap fell 17.4%, more than $1.8 trillion was lost on the stock market in a single day as investors looked to shed risky assets from their portfolios, accounting for the worst daily decline since March 2020.
For the Bitcoin market, CryptoQuant analyst Darkfost reports a notable increase in selling pressure from the derivatives market, resulting in a perpetual spot price gap of -$59.14, the largest on record in the history of BTC.
For context, the perpetual spot price spread represents the difference between a cryptocurrency’s price in the spot market (where an asset is traded directly) and its perpetual futures price (contracts that speculate on the future value of ‘an asset without expiration).
A negative spread means that perpetual futures contracts are trading at a lower price than the spot market, indicating bearish sentiment in the derivatives market. Therefore, the current very negative spot-perpetual price spread of -$59.14 suggests that derivatives traders are expecting a near-term decline in the price of Bitcoin.
However, Darkfost notes that perpetual spot price gaps are historically likely to close as markets stabilize. Therefore, extremely negative spreads such as those currently presented are often good buying opportunities, as markets tend to overreact during periods of heightened uncertainty before recovery occurs.
BTC Investors See Profit of Over $5.72 Billion Amid Falling Prices
Separately, crypto analyst Ali Martinez reports that the Bitcoin market recorded over $5.72 billion in profits made during the recent stock market crash. This indicates that a significant portion of Bitcoin holders were making profits before the price correction, which triggered profit-taking.
While large realized profits may signal cautious or bearish sentiment in the short term, they also suggest that Bitcoin’s prior price rally was large enough to benefit many investors who believe in a strong and sustainable bullish structure over the long term. .
At the time of writing, Bitcoin is valued at $97,182 with a gain of 0.83% over the past day. However, the asset’s trading volume is down 50.28% and is valued at $54.23 billion.
Featured image from Economic Times, chart from Tradingview
