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Bitcoin's worst week since FTX crash signals more pain ahead
Bitcoin's 15% weekly drawdown flushed leveraged positions built over the prior rally. Negative funding rates and bearish options expiry suggest the selloff has further room to run. The key support level is $70,000.
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Bitcoin fell roughly 15% in the past seven days, its steepest weekly decline since the FTX collapse. The drawdown flushed out leveraged positions built over the previous month's rally. The question now is not whether more downside follows. The question is which holders get caught next and where the structural floor sits.
Leverage Reset
Open interest across Bitcoin perpetual futures hit multi-month highs just before the drop, according to exchange data. When spot prices broke below $75,000, long-position liquidations cascaded. Funding rates had been elevated for two straight weeks, a classic setup for a squeeze. The scale of the unwind shows up in the funding rate flip. Positive funding turned negative within hours as shorts stepped in. That shift does not signal a bottom. It signals that the market is repricing risk to a level where new longs can enter without the same crowding. The question is where that level is.
Negative funding is a double signal. On one side, shorts are paying to hold positions, which can attract contrarian longs if the spot price stabilises. On the other side, sustained negative funding often correlates with continued price drift lower because the market remains biased toward sellers. The 30-day history shows funding was consistently positive from mid-February through early March. The shift happened inside one 24-hour window. That kind of velocity in the rate change catches more than the late longs. It catches algorithmic strategies that rely on mean-reversion in funding, adding another layer of selling pressure.
Support Zones
Price structure after a liquidation cascade is different from price structure after a slow grind lower. The cascade removes marginal holders quickly, creating a vacuum underneath. Actual support is not the round number. It is where the last wave of stop-losses cleared.
Watch the $70,000 handle. If price holds above it on a retest, the liquidation cascade has likely exhausted its immediate force. A break below that level, especially on volume, would open the path to the mid-$60,000s. That zone held in late 2023 and again after the ETF launch. It is the next structural floor.