Bitcoin Margin Longs on Bitfinex Defy Bearish September Trends

Despite Bitcoin's historically bearish performance in September, the number of bullish bets on the cryptocurrency is rising on Bitfinex, a popular exchange known for its large traders, often referred to as whales. Typically, Bitcoin has seen a 4% average drop in September since 2009, with the bears leading in six of the last seven years, according to data from Bitcoinmonthlyreturn.com. This has led many to brace for a potential downturn this month.

However, traders on Bitfinex appear to be bucking this trend, placing bullish bets on Bitcoin. Since August 28th, the number of margin longs on the exchange—positions taken using borrowed funds to buy Bitcoin in the spot market—has increased by a net 3,000 BTC, reaching nearly 64,350 BTC. At the same time, the annualized interest rate on these borrowed funds has soared to over 20% in the past 10 hours, indicating a strong willingness among traders to pay a premium to maintain these long positions.

This increase in borrowing to buy more Bitcoin suggests that some traders are betting that Bitcoin will break its usual September slump this year. "Green lending rates and long positions have always been an over-the-top indicator for bulls; the previous two major spikes were preceded by significant rises in rates and long positions," said Greeks.Live, a crypto block trading service, in a chat with CoinDesk. A green lending rate is when the interest rate charged is above zero, which often signals bullish sentiment.

Globally, activity in Bitcoin perpetual futures is also showing a bullish bias. The open interest-weighted global average funding rates have turned positive, suggesting that perpetual futures are trading at a premium to the spot price and indicating strong bullish sentiment.

Additionally, over-the-counter (OTC) desks are reporting increased demand for Bitcoin call options, which provide asymmetric payoffs during upward price movements. "The options market has started to see a large number of block calls, accounting for 30% of the day's total, with whales taking long positions across the board," Greeks.Live noted.

Further evidence of this bullish sentiment was seen on Monday, when call spread strategies were recorded on the OTC platform Paradigm. "Out-of-the-money (OTM) options were in focus today, including an 80K/100K December call spread and an ETH 27 Dec/28 Mar calendar spread. There was also another noteworthy SOL print," Paradigm reported in a Telegram broadcast.

These developments suggest that despite the historical trend of Bitcoin's September struggles, some traders are betting on a different outcome this year, supported by rising interest rates and increased demand for bullish options strategies.