Bitcoin traders on Bitfinex are showing optimism in the midst of a price dip, as they continue to buy the cryptocurrency with borrowed cash. This trend is a positive sign for crypto bulls who have been feeling the pressure of the recent market downturn.
The number of bitcoin purchased on Bitfinex with borrowed funds has increased to over 60,000 BTC, up from 50,773 earlier this month. This represents a 2% jump in the past 24 hours alone, according to data from Coinglass and TradingView.
These margin long positions are essentially bets placed by traders that the price of bitcoin will rise, allowing them to make a profit once they have repaid the loan. The fact that traders are increasing these positions is a vote of confidence in the cryptocurrency, despite its recent 20% decline.
Bitfinex traders, who are often whales holding large amounts of bitcoin, are known for accurately predicting market peaks and troughs. They tend to accumulate more bitcoin during downtrends or rangebound markets, as was seen last year.
Looking back over the past five years, margin long positions have consistently increased holdings during price drops and reduced exposure near market peaks. This pattern was evident during the market highs of 2021 and 2024.
As the crypto market experiences a downturn, the sentiment is currently one of extreme fear, according to Coinglass’ Crypto Fear & Greed Index. Over the past year, the market has only seen four days of extreme fear, with greed and extreme greed dominating for over 230 days.
Despite the current market conditions, the increased buying activity on Bitfinex is a positive sign for bitcoin bulls. It shows that traders are confident in the long-term potential of the cryptocurrency, even in the face of short-term price fluctuations. This continued support from experienced traders could help stabilize the market and potentially lead to a reversal in the recent downward trend.