Hedge funds trading bitcoin futures on the CME have flipped net long, reversing years of structural short positioning, according to CryptoQuant CEO Ki Young Ju. The shift traces back to a shrinking futures basis that now yields less than U.S. Treasury notes. Bitcoin itself is rebounding, trading above $65,000 after bottoming near $58,000 in July.
Hedge funds trading bitcoin futures on the Chicago Mercantile Exchange have turned net long, according to CryptoQuant CEO Ki Young Ju. The rare shift reverses years of structural short positioning built around the futures basis trade. It suggests professional traders are increasingly betting on bitcoin's price rising.
The basis trade becomes less attractive
Leveraged funds have historically stayed net short CME bitcoin futures because of the basis trade: buying spot bitcoin or exchange-traded funds while simultaneously selling futures against them. The strategy is market-neutral, profiting as the premium between futures and spot prices narrows rather than from bitcoin moving higher. That dynamic kept hedge funds' reported futures positioning negative for years.
But the trade has become less attractive. The annualized three-month bitcoin futures basis has fallen to approximately 3%, below the roughly 3.8% yield available on two-year U.S. Treasury notes. Lower returns, alongside added funding, margin and execution risk, leave traders with less incentive to hold the position.
A rare flip to net long
CryptoQuant CEO Ki Young Ju said hedge funds have flipped net long on bitcoin futures: "The suits are now betting on bitcoin’s upside."
Bitcoin is now trading above $65,000 after bottoming around $58,000 on July 1, and the move from structural futures shorts toward a net-long position lines up with that recovery. While some of the change may reflect basis traders closing shorts, crossing into positive territory shows CME leveraged funds' futures longs now exceed their shorts — a potentially important institutional bullish signal.
Source: CoinDesk
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