According to BlockBeats, on October 17, the funding rate of Ethereum perpetual futures contracts has risen to its highest point since the global liquidation event in August, when major cryptocurrencies such as Bitcoin and Ethereum fell by more than 20% as stocks fell. In response, derivatives trader Gordon Grant warned that the cryptocurrency perpetual futures contract market is still vulnerable to similar over-leveraged position-driven sell-offs, which may be driven by both technical and macroeconomic factors.
Grant said the cryptocurrency market would be vulnerable if another such exogenous shock occurred, similar to macro events such as the unwinding of yen carry trades that triggered liquidations in early August. In addition, other factors are also affecting the market. For example, investors are cautious about a potential pullback in Nvidia and other high-performing chip stocks, a slowdown in China's recent stock market rebound, and the continued spread of tensions in the Middle East. He believes that these factors, combined with the existing leverage in the crypto market, could catalyze or exacerbate a sharp decline in the market (even if it is short-lived), especially in options-driven liquidations. (The Block)
