Bitcoin rebounds as ETF inflows and funding rates steady sentiment

Bitcoin bounced back above $63,000 after a drop tied to Strategy’s Bitcoin sale announcement, a quick recovery that matters for retail investors watching whether recent crypto weakness is turning into a deeper slide. The move also put focus on derivatives and exchange-traded fund flows, two areas that often show whether traders are adding risk or pulling back.

Bitcoin fell to $61,300 after investors reacted to Strategy’s sale, according to Cointelegraph. It later recovered to about $63,500, while a market snapshot listed Bitcoin at $62,832.60, up 2.10%.

Strategy’s added $216 million cash position helped calm some concern about its ability to pay dividends and service debt, Cointelegraph reported. The company’s situation remains a pressure point for Bitcoin sentiment because its balance sheet is closely tied to the token’s price.

Derivatives showed caution, not panic

Data from Laevitas showed Bitcoin’s annualized funding rate for perpetual futures rose to 9% on Monday. Perpetual futures are derivatives contracts that do not expire, and the funding rate is the recurring payment between traders betting on higher prices and those betting on lower prices.

A positive funding rate usually means long positions, bets on gains, are paying shorts, bets on declines. The 9% reading suggested demand for leverage was more balanced after negative funding rates appeared Saturday, according to Cointelegraph’s reading of the Laevitas data.

Options data told a slightly more cautious story. At Deribit, put option premiums were higher than call option premiums on Monday, according to Laevitas. A put gives the holder exposure to downside protection or a bearish bet, while a call gives exposure to upside.

The put-to-call premium ratio stood at 1.15, Cointelegraph reported. Stress periods can push that ratio above 2, so the latest reading pointed to some concern without signaling severe fear.

ETF flows helped the rebound case

Spot Bitcoin exchange-traded funds listed in the US brought in $223 million in net inflows on Friday, according to SoSoValue data cited by Cointelegraph. A spot Bitcoin ETF holds exposure tied directly to Bitcoin’s market price and lets investors access it through a regular brokerage account.

Friday’s inflow followed 10 straight sessions of outflows. Cointelegraph reported that June saw a record $4.51 billion in net withdrawals from US-listed spot Bitcoin ETFs, a run that weighed on market sentiment.

For everyday investors, ETF flows matter because they show whether regulated investment products are attracting or losing cash. Sustained inflows can reduce selling pressure, while repeated outflows can add to it.

Strategy remains a key concern

Strategy’s preferred perpetual equity Stretch, traded as STRC US, has been under pressure, according to TradingView data cited by Cointelegraph. The instrument offers a 12% yield, but new stock issuance can occur only at a fixed $100 price, limiting the company’s available tools while the market price is below that level, Cointelegraph reported.

Cointelegraph also reported that Strategy has enough cash to cover 17 months of dividends, which reduces the near-term need for more Bitcoin sales. Even so, the company is carrying $8 billion in unrealized losses on its Bitcoin purchases and has 8% debt leverage, according to the same report.

Onchain data from Glassnode showed transfers from long-term Bitcoin holders to exchanges averaged 4,130 BTC per day, down from 8,040 BTC one week earlier. Transfers to exchanges are often watched as a proxy for potential selling, since investors usually move coins there when they may trade them.

The data points to less pressure from long-term holders, but Cointelegraph said derivatives traders may stay skeptical unless spot Bitcoin ETFs show a continued series of meaningful inflows. For now, Bitcoin’s recovery has steadied sentiment, while Strategy’s losses and cautious options positioning keep pressure on the market.

This story draws on original reporting from Cointelegraph.