Bitcoin has had a pretty normal August. Since August 2, it has been trying to get back above $65,000. The cryptocurrency is selling just below $60,000 right now, and the market has been stuck in a range for the past week. Bulls and bears are fighting over it.
CryptoQuant analyst XBTManager has put out a call for worry about the Bitcoin market’s continuing downward trends. The expert said on August 16 that the Spot-Perpetual Price Gap on Binance is always negative, which means that there is ongoing selling pressure.
Bitcoin Spot-Perpetual Gap Explained
The Spot-Perpetual Price Gap shows the gap between the price of Bitcoin on the spot market and the price of Bitcoin futures. If there is a negative difference between the perpetual price and the spot price, it usually means that traders are selling Bitcoin on the perpetual futures market because they think the price will go down even more.
XBTManager thinks that this negative gap could make traders more likely to sell their Bitcoin holdings in order to take advantage of arbitrage chances in the perpetual market. This could make the spot market more volatile.
This kind of behavior could lead to deep liquidation hunts, in which a lot of leveraged accounts are closed against their will. This makes the Spot-Perpetual Price Gap even more expansive and increases selling activity.
But the expert also pointed out a possible good thing about this situation. A buildup of short bets on BTC could happen if there is a lot of pressure to sell. If prices suddenly go up, these trades might have to be closed. This could lead to a lot of buying, which could help close the negative gap.
Bitcoin is now worth $58,981, which is 2.28 percent more than it was 24 hours ago. But the amount of cryptocurrency traded every day has dropped by 16.37%, to $29.5 billion. BTC is still losing money on a larger scale. It has lost 2.92 percent over the last seven days and 8.76 percent over the last thirty days.
