Bitcoin funding rates turning negative often signal rising bearish sentiment, as short positions dominate and pay longs to maintain balance in perpetual futures. This shift suggests traders are increasingly betting on price declines, reflecting caution or pessimism. However, historical patterns show negative rates can precede reversals, hinting at potential oversold conditions. Market sentiment may indeed be tilting bearish, but it’s not a definitive crash signal—context like leverage and broader trends matters. Monitoring funding rate swings alongside price action can reveal if this is a fleeting dip or a deeper shift.