Raydium's RAY Token Is the Most Overheated Cryptocurrency, Data Shows

Annualized perpetual funding rates in small cap tokens after bitcoin's (BTC) recent bullish pause has cooled jets in the broader market

As bitcoin’s (BTC) recent bullish pause has cooled jets in the broader market, annualized perpetual funding rates in small cap tokens have normalized costs associated with betting on price rallies. But one token is still blazing hot.

Solana-based decentralized exchange Raydium’s native cryptocurrency, RAY, is the only coin with annualized perpetual funding rates still exceeding 160%, making it the most overheated cryptocurrency among small-, mid- and large-cap tokens, according to data from VeloData.

The elevated rate suggests the market for RAY is overcrowded with long positions, with leverage skewed heavily toward the bullish side. In such conditions, even a slight dip in price can shake the confidence of over-leveraged bulls, especially late entrants, triggering a mass unwinding of long positions, which often exacerbates the price decline, leading to a more pronounced sell-off.

畢竟，衍生品市場的參與者通常會放大現貨市場的趨勢，因為他們可以通過多頭或空頭頭寸進行高達 50 倍的槓桿交易。當市場參與者過度看漲時，任何看跌跡象都可能導致信心危機，從而引發多頭頭寸的快速平倉。

毕竟，衍生品市场参与者通常会放大现货市场的趋势，因为他们可以进行高达 50 倍杠杆的多头或空头头寸。当市场参与者过度看涨时，任何看跌迹象都可能导致信心危机，从而引发多头头寸的快速平仓。

Tokens with a market capitalization of less than $5 billion, such as RAY, are particularly vulnerable to shenanigans in the derivatives market.

It’s easy to see why bulls have thrown caution to the wind. Despite the recent 17% price pullback to $5.39, RAY is still up 67% for the month versus market leader BTC’s 35% surge, CoinDesk data show.

The market-beating rise comes amid record activity on Raydium. According to data source Artemis, Raydium has registered a trading volume of $117.8 billion this month, nearly twice the entire Ethereum-based DEX volume of $66.8 billion. Raydium has generated $175 million in fees versus Ethereum’s $168 million. Ethereum is the world’s largest smart contract blockchain.

Note that much of the record activity on Raydium occurred early this month, primarily driven by the memecoin frenzy, which propelled trading volumes to record highs, fueling significant interest in the RAY token. However, the frenzied momentum has begun to cool, weakening the underlying support for a sustained rise in the RAY token.