Crypto Market Makers Profit from Basis Trades in Bitcoin Rally, Not Directional Bets

According to CoinDesk, as Bitcoin rapidly surged from around $62,000 to above $77,000 last week, liquidating approximately $3 billion in leveraged shorts, major crypto market makers such as Abraxas Capital, Fasanara Capital, and Wintermute quietly built hundreds of millions of dollars in perpetual short positions on Hyperliquid. Lookonchain data shows that the three institutions collectively hold short positions of 138,569 ETH (approximately $338 million) and 3,425 BTC (approximately $265 million); meanwhile, Abraxas Capital has withdrawn 73,872 ETH (approximately $173 million) from Binance over the past four days. This strategy is known as cash-and-carry or basis trading: traders hold spot positions while shorting an equivalent amount via perpetual contracts to hedge price volatility risk, primarily earning funding rates paid by longs to shorts. Over the previous months, funding rates were compressed or even turned negative for an extended period, but this month's rally quickly pushed funding rates back into positive territory, reopening the arbitrage window. Aegis data shows that on August 24, the 30-day average annualized funding rate for Bitcoin perpetual contracts reached 6.7%, with the 7-day average at 8.7%; 21shares Capital noted that basis trades in major assets like Solana have also become increasingly lucrative. The trade has extended into regulated markets: Glassnode data shows that CME Bitcoin futures open interest rose from approximately 87,000 BTC to 122,000 BTC.