VanEck analyst: Bitcoin shows two historically bullish signs of declining computing power and negative funding rates

VanEck analysts Matthew Sigel and Patrick Bush wrote an analysis saying that Bitcoin has shown two historically bullish signs: negative funding rates and hash rates have dropped in a concentrated manner, while volatility has cooled. As tensions between the United States and Iran eased, Bitcoin's realized volatility fell from 56% to 41%, while the 7-day average funding rate turned negative to-1.8%, the lowest level since 2023. Historically, negative funding rates often signal strong future gains: Since 2020, the average 30-day Bitcoin yield during the negative funding rate period has been +11.5%, while the overall yield has been +4.5%, with a hit rate of 77%. Funding rates below-5% yielded a gain of +19.4% over a 30-day period. In addition, computing power has dropped to the 16th percentage point in the past 30 days, which is the most concentrated decline in computing power since mining was banned in 2021. Of the past seven declines in computing power, six have seen Bitcoin prices rise after 90 days, with a median increase of +37.7%.