Leverage can indeed go below 0x under certain conditions. When you receive funding payments, they are added to your collateral, and in the crypto-collateralized markets, this adds "long" exposure to your short position. This decreases your position size and leverage, which can make it go below 0. The leverage calculation takes into account the net effect of your collateral’s value, not just the notional size of your position or the losses incurred from fees.