oinonen_t2026-01-19

Low Funding Rate Indicates a Spot-Driven Market

[Context] While BTCUSD has mirrored moderate weakness during recent days, January represents a positive recovery phase for bitcoin. The sentiment remains cautiously optimistic, supported by institutional and whale-level buying, while retail stays cautious. [A Spot-Driven Market] As CryptoQuant’s Binance-related data shows, BTC-USDT and funding rate have been diverging in early 2026, representing a spot-driven market environment. The spot-driven environment is healthy for bitcoin, as it reduces the risk of cascading liquidations from over-leveraged positions. Additionally, spot-driven trends tend to last longer and attract more organic capital inflows (including institutional spot buying). Historical data from the 2021 and 2024 cycles shows spot and funding rate divergences preceding 20-50% upside continuations. [Is the Four-Year Cycle Dead?] As the digital asset market matures, multiple analysts argue that the traditional four-year cycle might be dead. After 2024, spot bitcoin ETFs and corporate treasuries have been absorbing a larger piece of the supply. This creates more consistent demand, lower volatility, and less extreme dynamics. The post-halving year of 2025 showcased relatively poor performance for bitcoin, with no massive parabolic rally, and a lack of proper altseason. This contrasts with prior cycles. Overall, halvings matter less as Bitcoin matures into a $2T+ asset. Global liquidity (Federal Reserve, M2 growth), geopolitics, and institutional flows drive price more than supply shocks. Analysts like Raoul Pal note the shift to longer "liquidity cycles", potentially lasting 5+ years. The four-year cycle being history is a sound thesis. [About Binance] Binance has historically been a whale-preferred exchange. As the dominant global digital asset exchange, Binance is an important leading indicator for the whole market.