Cardano Among Alts Likely To See Price Boosts, Santiment Says!

In a new post on X, Santiment has talked about the altcoins being shorted against on the derivatives market. The indicator of relevance here is the “Funding Rate,” which keeps track of the periodic fee that derivatives traders have to exchange with each other.

When the value of this metric is positive, it means the long contract holders are currently paying a premium to the short investors to hold onto their positions. Therefore, this kind of trend implies the presence of a bullish majority sentiment in the market.

In the current topic, Santiment has referred to the Funding Rate specifically for the cryptocurrency exchange Binance, which is the largest platform by trading volume and should, thus, represent the trend on other large exchanges.

All three of Cardano, Chiliz ($CHZ ), and Fantom ($FTM ) have seen their Binance Funding Rate stay inside the negative territory for the past five weeks, implying that investors have continuously been betting against a bullish outcome for them.

Historically, such aggressive shorting against any asset has positively affected its price. This is because a liquidation squeeze is more likely to affect the dominant side of the market right now.

A “liquidation squeeze” is an event where a sharp move in the price liquidates a large amount of contracts at once. These liquidations feed back into the move that caused them, thus amplifying it and kicking off a cascade of further liquidations.

The chart shows that these three altcoins had also seen a similar level of shorting earlier in the year. What followed this bearish sentiment was a surge in their prices. Cardano saw a 10% surge, Chiliz 32%, and Fantom 49%. Thus, going by this trend, it’s possible that short liquidations could once again happen for these altcoins and lead to a rally in their prices.
#CardanoStablecoin" #ChilizRevolution #FantomFoundation #TrendingBinance #ViralTopic