As October started, the cryptocurrency market faced a significant crash, increasing the bearish sentiment and attracting highly capitalized short-sellers. Some cryptocurrencies now risk suffering a short squeeze as imbalances appear in the market’s open interest, dominated by short positions.
In particular, Sui (SUI) and Celestia (TIA) stand out with remarkably high negative funding rates, according to data from CoinGlass. On October 4, SUI and TIA short-sellers were paying 71.54% and 124.88% APR to long position holders, respectively.
These funding rates were the most asymmetric among the 30 cryptocurrencies with the highest open interest in the market.
Essentially, funding rates can increase or shrink due to imbalances between open shorts and longs, interfering in the dynamics. Highly shorted markets will punish short-sellers with a higher cost to keep their positions open, potentially causing a short squeeze.
Funding Rate Heatmap of SUI and TIA. Source: CoinGlass / Fi
We współpracy z: https://finbold.com/short-squeeze-alert-for-two-highly-shorted-cryptocurrencies/
