Beijing time, January 3rd. In the first week of the New Year, the Bitcoin market appears relatively stable in price, but there is a significant divergence in funding structure and on-chain behavior. The recovery of spot premiums, rising financing rates, and the funding game of on-chain "ETF-like" products intertwine, laying the groundwork for the first wave of trends in 2025.
Spot Premium and Funding Rate: Aggressive Funding Under Price Consolidation
● News Driven:
● Since late December, the spot price has generally maintained a fluctuation in the $95,000–$100,000 range, with a closing price of about $97,800 on January 2nd, showing a change of less than +1.5% compared to a week ago, with price volatility significantly narrowing.
● In contrast to the price consolidation, the USDT perpetual contract funding rates on major exchanges rose again to the annualized range of 25–35% from January 1st to 3rd, with some periods peaking around annualized 40%, significantly higher than the average level of 10–15% in late December.
● Spot and Contract Structure: On leading platforms, the long open interest of BTC perpetual contracts increased by about 8–10% over the week, while the spot trading volume only slightly rose by 3–5%, indicating a significant leverage amplification effect in derivatives.
● Funding Trends:
● Spot discount reversed to premium: At the end of December in the East Eight Zone, a slight discount structure of annualized -2% to -5% appeared in some on-chain and off-chain transactions, while in the first week of January, some off-chain dollar quotes against exchange coin prices returned to an annualized premium of +3% to +7%, indicating that low-risk funds are shifting back to a long bias on the basis.
● Inter-period basis uplift: The quarterly contract premium over spot on CME and leading crypto exchanges rose from annualized 6–8% in mid-December to annualized 10–12%, indicating an increased willingness of institutions to allocate in mid- to long-term contracts.
● Concentrated Long Leverage: From the data on individual positions and liquidation records, the liquidation volume during January 1st to 3rd did not significantly increase, indicating that leveraged longs are more in a "comfort zone" and have not encountered directional liquidation.
● Structural Signal Interpretation:
● The significant rise in funding rates and the recovery of spot premiums reflect more of a "overheated bullish sentiment in funding rather than passive price chasing in spot."
● The simultaneous rise in rates and basis under price consolidation indicates that bulls are using time to exchange for space, maintaining high-cost long leverage, betting on a directional breakout in the coming weeks.
● If there is a lack of new external catalysts in the short term, the high funding rate structure may evolve into a "time kill" and rate harvesting unfavorable to bulls, laying the groundwork for potential reshuffling.
On-chain "ETF-like" Products and Large Transfers: Potential Institutional Invisible Reconstruction on-chain
● On-chain Funds and Large Transfers:
● From December 30th to January 2nd, the daily average of large transfers of ≥1,000 BTC on the Bitcoin chain maintained in the range of 230–260 transactions, about +20–30% compared to the average in November, indicating that the restructuring of large addresses is still ongoing.
● The number of active addresses on-chain remains at a platform level of about 900,000–1.1 million per day, showing no significant increase compared to the October peak, indicating that incremental users have not entered the market on a large scale, and it is still a rearrangement of existing funds.
● The net flow of exchanges slightly leaned towards outflow in the first week of January, with daily net outflows fluctuating in the range of 2,000–6,000 BTC, showing a mild accumulation characteristic of "prices not rising but coins slowly leaving the exchanges."
● "ETF-like" Products and On-chain Structure:
● Some on-chain "ETF-like" asset management addresses (mostly custodial wallets and multi-signature structures) added a total of tens of thousands of BTC from late December to early January, but the daily increments showed significant fluctuations, not a one-sided linear purchase.
● Similar to traditional ETFs, these on-chain products mostly adopt a full collateralization and tokenization of shares structure, allowing users to convert between a basket of assets and on-chain shares through a subscription and redemption mechanism.
● Subscription and redemption behaviors are significantly correlated with secondary market prices and futures basis: when premiums expand and basis is high, it is more about existing institutions using arbitrage opportunities to go long on the basis rather than purely passive fund inflows.
● Potential Institutional Behavior Mapping:
● Large transfers are concentrated between exchanges ↔ custodial addresses, cold wallets ↔ multi-signature addresses, combined with net outflows in spot and rising derivatives positions, indicating that whether it is compliant ETFs or on-chain "ETF-like" products, their underlying operational logic is increasingly "institutionalized."
● Unlike the retail-led on-chain boom in 2021, this round reflects more of a "large slow movements, with retail following in small steps": large addresses first complete the underlying migration and structural optimization, then driven by secondary market prices, gradually attract small and medium funds to follow in.
Long-Short Narrative Split: Stable Spot, Volatile Derivatives, Slow On-chain
The structural changes in Bitcoin during the first week of 2025 are not isolated phenomena but resonate with the macro liquidity expectations, ETF funding patterns, and post-halving miner games over the past two months. While spot prices hover at high platforms, the high-leverage longs in the derivatives market, slow expansion of on-chain "ETF-like" products, and redistribution of large addresses combine to create a market environment that appears calm on the surface but has internal tensions continuously rising. On the funding side, expectations of peak dollar rates and the risk appetite recovery in traditional markets have made some institutions willing to bear the volatility of crypto assets again, translating into rising futures basis and funding rates; on-chain, through "ETF-like" custodial structures and custodial address migrations, the fragmented holdings of retail from 2020-2021 are gradually being reorganized into more concentrated large positions. Ultimately, the long-short narrative hedges in the tension of "long-term institutional buying, short-term leverage overheating," keeping prices temporarily within a high-level range, but this also means that once new shocks occur on the macro or regulatory front, the current high leverage and high basis structure will significantly amplify subsequent volatility.
Long-Short Viewpoint Game: Different Bets in High-Position Fluctuations
● Optimistic/Supporters:
● They believe that the synchronous rise of spot premiums and futures basis is a signal of medium- to long-term capital continuously entering the market, and the current high funding rates are the "ticket costs" the market pays to seize the opportunity for an upward move.
● They emphasize that large on-chain transfers and the increase in "ETF-like" addresses mean that the underlying chips are gradually shifting from short-term traders to long-term custodial accounts, which constitutes a substantial benefit for the supply and liquidity structure throughout 2025.
● Within this framework, high-position fluctuations are seen as "energy accumulation before the main upward wave," and as long as there is no large-scale liquidation and structural capital withdrawal, any pullback is more like a technical reshuffle in the upward process.
● Pessimistic/Opponents:
● They are concerned that the current funding rates and basis levels are too high, forming a "time loss" unfavorable to longs under the background of price consolidation, and once short-term sentiment reverses, leveraged longs may face "liquidation-style reductions."
● They point out that the number of active on-chain addresses and new addresses has not significantly increased, indicating that incremental retail has not entered the market on a large scale, which bears similarities to the structure of "institutions taking over, retail retreating" at the end of the 2021 bull market, posing structural risks at the top.
● From this perspective, large transfers appear more like structural transfers and hedging layouts of high-position chips, rather than one-sided net buying; once macro or regulatory expectations fall short of market pricing, the existing high leverage and increased concentration may amplify downward volatility.
Outlook: Key Observation Points Under High Leverage and "ETF-like" Resonance
In the short term, the market will focus on whether funding rates remain high, whether futures basis declines in an orderly manner, and the rhythm changes in on-chain "ETF-like" subscriptions and custodial address holdings. If in the next two to three weeks, Bitcoin prices can fluctuate upward with a moderate decline in funding rates without large-scale liquidations, then the current structure leans more towards a healthy phase of long digestion; conversely, if prices continue to consolidate or even decline while funding rates and basis remain high, leveraged longs will face passive deleveraging pressure. For medium- to long-term observers, the more critical variable is whether the holdings of large on-chain addresses and "ETF-like" custodial wallets continue to rise and whether their growth rate can offset the supply contraction brought about by miner reductions in the coming months. The first week of 2025 has already indicated that this will be a key phase in the year for the further "ETF-ization" of institutional capital structure and on-chain asset forms, where price is merely a surface phenomenon, and the redistribution of underlying chips is the core determinant of trend length and height.
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