
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.
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.
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.
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.
The week's selloff did not come from a single news event. That makes a recovery catalyst harder to call. A dovish Fed pivot, a major sovereign buyer stepping in, or a regulatory clarity signal from the U.S. SEC would shift the narrative. None of those are on this week's calendar.
What is on the calendar is options expiry. Monthly Bitcoin options worth roughly $5 billion expire this Friday. The put-call ratio shifted sharply bearish over the past 48 hours. Max pain sits near $72,000. If spot stays below that, option market makers will have little incentive to defend higher levels. That keeps pressure on during the expiry window.
Bitcoin's perpetual open interest dropped about 20% from its highs. That is a healthy purge, not a complete flush. Historical cycles show that when open interest contracts more than 30% from the cycle peak, the bottom usually appears within two weeks. The market is not there yet.
The worst week since FTX is in the books. The next few days will tell traders whether this is a correction within a trend or the start of a deeper cycle. Watch the funding rate for a sustained return to positive. Watch open interest for another leg lower. And watch Friday's options expiry for the next volatility window. None of those signals have triggered yet.
The default posture is caution. The margin of error for long entries is thin. The short side has less congestion, the reward after a 15% drop is asymmetric, and the bounce can be violent if shorts pile too deep. Same setup, different week.
For real-time funding and OI data across exchanges, check the crypto market analysis page. The Bitcoin profile tracks block-level accumulation patterns that can confirm or rebut the sell-side exhaustion thesis.
Prepared with AlphaScala research tooling and grounded in primary market data: live prices, fundamentals, SEC filings, hedge-fund holdings, and insider activity. Each story is checked against AlphaScala publishing rules before release. Educational coverage, not personalized advice.