Bitcoin Breaks Above $75K, But Bears Refuse To Blink

Bitcoin has reclaimed and held above the $75,000 region after the latest rebound, but derivatives data shows the recovery lacks broad conviction.

Bitcoin In The Middle Of A Credibility Problem

Bloomberg claims Bitcoin has a credibility problem right now. Funding rates on perpetual futures have stayed negative for around a month and a half, meaning leveraged traders are still paying to stay short even as spot grinds higher.

This divide ranks among the largest this year between spot price action and how derivatives traders are positioned. Bitcoin has climbed about 14% off its April lows, helped by renewed inflows into US‑listed ETFs and fresh accumulation by Michael Saylor’s Bitcoin treasury firm, MicroStrategy.

Such a gap between positioning and price rarely lasts long, and it usually ends brutally for someone. When Bitcoin keeps grinding higher, traders shorting the move rack up losses and can be forced to rush in and buy back their positions, driving an abrupt, self‑reinforcing spike known as a short squeeze. The longer this standoff drags on, the more violent that eventual reversal can become.

BTC OI-Weighted Funding Rate. Source: Bloomberg.

The data brought by Bloomberg shows that net flows into US‑listed spot Bitcoin ETFs have hit about $332 million so far this week, with roughly $26 million added on Thursday alone. By 8 a.m. in London on Friday, Bitcoin was changing hands near the $75,000 mark.

This has been one of the longest bearish funding streaks since the post‑FTX capitulation period in late 2022, when sentiment was similarly washed‑out.

A Short-Squeeze Risk

Vetle Lunde, head of research at K33, told Bloomberg that “Traders are actively building short positions and betting against a breakout, creating conditions where a short squeeze becomes more likely if upward momentum persists”.

The current structure looks like a textbook squeeze setup. Negative funding shows that short sellers still dominate leverage and are paying to stay in the trade, even as Bitcoin grinds higher. That slow grind means many of those shorts are already underwater but haven’t capitulated yet, leaving them vulnerable. At the same time, spot liquidity looks thin, so any sharp move can quickly ripple through derivatives and turn into a fast, cascading squeeze.