Bitcoin has recovered to hold above $75,000, but derivatives data suggests the rebound lacks strong conviction. Perpetual futures funding rates have remained negative for about a month and a half, indicating that leveraged traders are still paying to hold short positions even as the spot price climbs. This disconnect between spot price action and derivatives positioning is among the largest seen this year.
Bitcoin has risen roughly 14% from its April lows, supported by renewed inflows into U.S.-listed ETFs and continued accumulation by MicroStrategy, which has purchased $2.6 billion worth of Bitcoin in the past two weeks alone.
Such a gap between market positioning and price rarely lasts long and often ends abruptly. If Bitcoin continues to rise, short sellers face mounting losses and may be forced to buy back their positions, potentially triggering a sharp, self-reinforcing short squeeze. The longer this standoff persists, the more violent the eventual reversal could be.
Data shows U.S. spot Bitcoin ETFs have seen net inflows of about $332 million this week, including roughly $26 million on Thursday. This negative funding streak is one of the longest since the post-FTX period in late 2022.
According to Vetle Lunde of K33, traders are actively building short positions and betting against a breakout, increasing the likelihood of a short squeeze if upward momentum continues. The current setup resembles a textbook squeeze: shorts dominate leverage and are paying to maintain their positions even as Bitcoin grinds higher, leaving many underwater but not yet closed. With spot liquidity appearing thin, any sharp price move could quickly cascade through derivatives.
The market backdrop looks fragile given several bullish catalysts, any of which could force bears to cover. In addition to ETF inflows and corporate buying, Charles Schwab has announced plans to introduce spot crypto trading this year and suggested clients could allocate up to 8.8% of their portfolios to Bitcoin, pointing to potential latent demand.
Over the past week, U.S. Bitcoin ETFs have attracted over $800 million, shifting from earlier outflows to strong net inflows. Each wave of ETF buying pushes prices higher, making it more costly for short sellers to maintain losing positions and increasing squeeze pressure.
However, bearish traders could still profit if the current recovery falters. Options data shows demand for downside protection, with significant open interest in put contracts at $60,000 and $50,000 strikes. Some analysts describe this as a soft recovery.
Laurens Fraussen of Kaiko believes Bitcoin could see a rally that catches many off guard.A break above $76,000 could push Bitcoin toward $85,000. Currently, BTC is trading near $76,000 on the daily chart.
Frequently Asked Questions
FAQs Bitcoin Surges Past 75000 But Sellers Hold Strong
BeginnerLevel Questions
1 What does it mean that Bitcoin surged past 75000
It means the price of one Bitcoin rose very quickly to break through the 75000 mark reaching a new alltime high This is a major milestone showing significant investor interest and buying pressure
2 If the price is so high why arent sellers backing down
Sellers not backing down means that even at this high price a large number of people are choosing to sell their Bitcoin instead of holding This creates strong selling pressure that can prevent the price from rising even faster or could lead to a pullback
3 Is this a good time to buy Bitcoin
This is a personal financial decision with high risk Buying at an alltime high can be risky if the price corrects afterward Its crucial to only invest money you can afford to lose do your own research and consider a longterm strategy rather than trying to time the market
4 Whats causing this price surge
Major factors include the approval of Bitcoin spot ETFs the upcoming Bitcoin halving and general optimism about cryptocurrency adoption
5 What is selling pressure
Selling pressure is the combined effect of many traders and investors selling an asset When selling pressure is high it can overwhelm buying demand and push the price down even during a general uptrend
Advanced MarketFocused Questions
6 How can the price keep rising if theres so much selling
The price rises because buying demand is even stronger than the current selling pressure Large institutional investors whales and other buyers are absorbing the coins being sold pushing the price upward in a battle between bulls and bears
7 What are key indicators to watch in this situation
Exchange Reserves Are Bitcoin holdings on exchanges increasing or decreasing
ETF Flows Are the new spot Bitcoin ETFs seeing net inflows or outflows