Bitcoin futures funding rate suggests 2025 starting with cautious optimism: analysts
2025-01-02
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Bitcoin is currently holding above $96,000, with analysts attributing its stability to traders' cautious approach ahead of potential market-moving events, including Donald Trump's inauguration on Jan. 20.
The bitcoin perpetual futures funding rate stands at 0.01%, per the most recent 8-hour contract cycle across most major exchanges, according to Coinglass data. This is the highest in over one week but still within a neutral range, according to Bitget Wallet COO Alvin Kan.
The bitcoin futures funding rate has seen a slight increase across most centralized exchanges in the past 24 hours. Image: Coinglass.
"Currently, there is no significant increase in the bitcoin perpetual futures funding rate, which has remained within the neutral range," Kan told The Block. This stability indicates that, while there is some optimism, traders are exercising caution ahead of key events — such as Trump's inauguration — before committing to long positions, Kan added.
Over the past 24 hours, the cryptocurrency market saw over $130 million in short liquidations across major centralized exchanges, Coinglass data showed. Bitcoin accounted for $35 million of these liquidations, with $28 million coming from short positions. Ethereum followed with $15 million in total liquidations, $12 million of which were shorts. This trend, combined with declining trading volumes across exchanges, highlights a growing caution among traders, who appear hesitant to place significant bets against bitcoin in the current market environment.
Emerging narratives with AI-tokens and market trends
While bitcoin holds steady, new narratives are emerging in the broader cryptocurrency market.
AI-integrated tokens, particularly those using blockchain for portfolio management and decentralized finance optimization, are gaining traction among investors and analysts. “AI-tokens are emerging as a significant trend as AI integrates with blockchain technology,” said Alvin Kan. “By 2025, we expect AI agents to play pivotal roles in portfolio management and blockchain governance.”
WeFi co-founder Maksym Sakharov noted that developments — like those surrounding the ai16z — mark a shift in crypto narratives, much like NFTs and DeFi did in earlier cycles. “AI-tokens represent the fastest-growing segment of the industry, reshaping the ecosystem with innovative use cases,” he said.
O.xyz founder Ahmad Shadid shared with The Block that, while tokens like ai16z carry speculative appeal, the sustained growth and adoption of AI agents could transform blockchain transactions. The o.xyz founder said that if current development trends continue, a substantial portion of blockchain transactions across the industry could be driven by AI agents. "In the coming months, we’d likely see more than double the 10,000 AI agents already in the market, with a key focus on upholding the decentralization tenets," Shadid told The Block.
Dragonfly Managing Partner Haseeb Qureshi, meanwhile, predicted that the AI agent craze will dominate this year as it’s the most social — but that the novelty will eventually wear off. “Instead of monetizing through memecoins like today, future chatbots will monetize the same way human KOLs [key opinion leaders] do—through sponsorships, affiliate links, and pumping tokens they own,” he said. “KOLs will be routinely accused of being chatbots, and you will see AI-unmasking scandals. This will all get weird.”
Altcoin performance and market outlook
Additionally, altcoins have shown significant recovery after a challenging close to 2024.
“The recent altcoin uptick reflects a rebound from December’s volatility," Sakharov told The Block. "This momentum may challenge Bitcoin’s dominance as we move into 2025."
Sakharov pointed to recent projections from Steno Research that suggest ether could outperform bitcoin this year, with the ETH/BTC ratio potentially rising from 0.035 to 0.06. "Additionally, Galaxy Research sees Ethereum hitting a $6000 price mark in 2025, with Bitwise’s Matt Hougan and Ryan Rasmussen also seeing the coin reclaim its all-time high in the coming year," Sakharov noted.
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