Bitcoin dropped more than 10% in a single day last week and briefly held above $60,000, only to rebound later toward $70,000. That violent swing revived a familiar question in the market: has Bitcoin already gone through a real capitulation event, where panic selling exhausts the remaining supply and clears the way for a durable bottom?
Greg Magadini, director of derivatives at Amberdata, does not think the futures market supports that view yet. In a market note released on Monday, he said derivatives positioning still suggests Bitcoin may have more room to fall before a true washout is in place.
Futures basis has not shown the deep stress seen at major lows
The main signal highlighted in the report is futures basis, the gap between futures prices and spot prices. Traders often use that spread to read sentiment and positioning. When futures trade well above spot, the market is usually leaning bullish and willing to pay a premium for future exposure. When futures slip below spot and move into discount, bearish pressure is typically building.
Magadini’s argument is that past Bitcoin bear market bottoms were usually accompanied by large discounts in futures and perpetual contracts. Those episodes reflected a market under heavy stress, with leverage getting flushed out and holders exiting positions at a loss. Price declines alone are not enough. The derivatives side normally shows a much sharper sign of surrender.
That pattern did not appear clearly in last week’s sell-off. According to the report, Bitcoin’s 90-day futures basis did move lower with each leg down, but the move was limited and almost never exceeded -100 basis points. It never developed into a deep discount. At present, fixed-maturity Bitcoin futures are still trading with a basis of roughly 4%, a level close to the yield on risk-free US Treasury debt.
The 2022 bear market ended with a much larger discount
To frame the current move, Magadini pointed back to the late stage of the 2022 bear market. When Bitcoin fell below $20,000, 90-day futures briefly traded at a discount of as much as 9%. That was a far stronger sign of extreme pessimism, broad deleveraging, and traders pulling back from leveraged exposure.
Measured against that earlier episode, the latest decline looks incomplete from a derivatives perspective. Spot prices have already seen a sharp break and rebound, but futures markets have yet to show the kind of deep discount that usually appears when traders fully give up. If historical patterns still hold, Bitcoin may need another leg lower before futures traders reach full capitulation and the market forms what could be called a true bottom.
This article is based only on the source material and does not constitute investment advice.