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0/ The $BTC @bitfinex levered L/S ratio declined ~12.5% yesterday DoD a bottom ~5.0% move since the data was made public in Aug '17. This was driven primarily by long liquidations w/ a small uptick in shorts. At 1.294 last it's in the ~50% range over that period. 
1/ Looking at prior instances where the ratio decreased that much on a % basis the subsequent 1-3D period skews slightly positive while the ~5-20D post continues the downward trend in $BTC price action.
2/ We've noted what appears to be a declining relevance of this metric as @bitfinex has become less & less relevant. The @BitMEXdotcom $BTC funding rate is in the bottom ~8.5% of observed periods after sharply readjusting lower yesterday.
3/ Looking at $BTC's funding rate & L/S side by side you can see the divergence between the two started to occur in Nov and has continued. There's been a lack of a discernible arb opportunity especially when you account for @bitfinex 3% cost of doing business.
4/ This is occurring as the delta between $BTC's "realized cap" vs "market cap" is hovering at a ~20% discount again...bottom 5.0% of observed periods back to 2011.
5/ In 2015 this $BTC ratio was negative for 10 consecutive months as the last bear market ended & price began to recover.
6/ This may point to marginal $BTC supply drying up but says nothing about demand. That's why all those charts overlaying previous bear markets are largely nonsensical. We're in a different macro environment coupled with much larger notional amounts to deal with.
7/ Need to figure out what the next demand driver is.
8/ As we think about the supply side dynamics b/w Dec & Jan the daily $BTC & $ETH combined $$ inflation is at the lowest level since May '17. As a % of exchange volume (which is faulty) it's at the lowest ever....just gotta find ~$70mn+/week to offset that.
