Hedge Funds Wary of Crypto Market, Net Short Positions on the Rise
CryptoNewsTerminal Staff27 May, 2024
Hedge Funds Wary of Crypto Market, Net Short Positions on the Rise
According to a report by crypto research firm Kaiko, many hedge funds have recently moved to net short positions in BTC and ETH futures markets. This indicates a cautious stance on the future value of cryptocurrencies. The report outlines that the funding rate for BTC and ETH perpetual futures contracts has ticked up to 0.07%, indicating overheating in the markets. Despite this, traders are willing to pay these funding fees to maintain long (net buy) positions as BTC and ETH prices continue to rally. Traders are using more leverage to increase their potential returns, but this strategy is unsustainable given the volatility in the cryptocurrency markets.
