BTC Price Prediction End of 2025: Back to ‘Backwardation’, Accumulation Signal Amid Market Fears?

Jakarta, Pintu News – Bitcoin (BTC) has experienced another backwardation phenomenon, where the futures price is lower than the spot price. This condition usually indicates market stress, extreme fear, or intensive hedging activity.

This backwardation occurs when Bitcoin has dropped up to 30% from its all-time high. According to Thomas Young, Managing Partner at RUMJog Enterprises, this phenomenon is rare and often signals the right time to take a position against the market trend.

Backwardation and Market Signals

Backwardation in Bitcoin doesn’t happen often, but when it does, it usually marks stress or forced de-risking. Thomas Young emphasizes that this condition could be a turning point or a continuation of the price decline. Historically, backwardation has marked market bottoms several times, such as in November 2022 when Bitcoin hit $15,000 during the FTX crash.

Backwardation also appeared in March 2023, when Bitcoin briefly fell below $20,000 during the SVB and USDC depeg events, before rebounding strongly. Another example occurred in August 2023, when the Grayscale ETF news caused massive selling that pushed the price towards $25,000, which then became a short-term bottom and a quick rebound.

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Base Analysis and Market Implications

The annualized three-month rolling basis has now fallen to around 4%, the lowest level since November 2022. This basis measures the annualized return available from basis trading, where traders buy Bitcoin spot and sell futures contracts that mature in three months. Typically, futures are traded at a premium, while spreads offer relatively low-risk yields.

This sharp drop in premium indicates that demand for leveraged long exposure has fallen dramatically. In bullish phases, traders are willing to pay more for forward exposure which drives the basis higher, as happened in March 2024 when the basis reached 27% during Bitcoin’s all-time high price of $73,000.

Conclusion

The current dip suggests a more cautious environment, softer risk appetite, and a market that is still digesting the recent downturn. During moments of extreme enthusiasm, the curve can shift into steep contango, but under normal conditions Bitcoin trades in a relatively mild contango structure. Investors may need to consider current market conditions and the potential for a rebound before making investment decisions.

FAQ

What is backwardation in the context of Bitcoin (BTC)?

Backwardation is a condition in the futures market where the futures contract price is lower than the spot price. In the context of Bitcoin (BTC), this often indicates market stress or extreme fear.

When was the last time Bitcoin (BTC) experienced backwardation?

Bitcoin (BTC) experienced its last backwardation in August 2023, which was triggered by news from the Grayscale ETF that caused a price drop towards $25,000.

What impact does backwardation have on the price of Bitcoin (BTC)?

Backwardation often marks a market low, which can be a signal for a price reversal or continuation of further decline.

How does the annualized three-month rolling basis affect Bitcoin (BTC) trading?

The annualized three-month rolling basis measures the annualized return from basis trading, where Bitcoin (BTC) spot is bought and futures contracts are sold. Changes in this basis could indicate changes in market sentiment.

What should investors consider before investing in Bitcoin (BTC) during backwardation periods?

Investors should consider the level of market fear, the current state of backwardation, and the potential for further rebound or decline before making an investment decision.

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*Disclaimer

This content aims to enrich readers’ information. Pintu collects this information from various relevant sources and is not influenced by outside parties. Note that an asset’s past performance does not determine its projected future performance. Crypto trading activities have high risk and volatility, always do your own research and use cold cash before investing. All activities of buying and selling bitcoin and other crypto asset investments are the responsibility of the reader.

Reference

• Coindesk. Bitcoin Backwardation Returns, a Pattern That Often Marks Market Bottoms. Accessed on December 5, 2025
• Featured Image: Generated by AI