Major crypto trading firms are extracting yield from Bitcoin's latest surge through cash-and-carry strategies rather than directional wagers, as elevated funding rates create attractive risk-neutral income in a market that has climbed back above $80,000.

Market Context

Bitcoin rocketed from around $62,000 to above $77,000 in days before extending toward the $80,000 level this week, wiping out an estimated $3 billion from leveraged short sellers who had built bearish bets during the prior drawdown. The move has reshaped market structure, flipping funding firmly positive and reviving carry trades that had lain dormant for months amid compressed or negative rates from February through July.

The recovery in BTC funding has been sharp: 30-day average perpetual funding reached 6.7% annualized on Aug. 24, while the 7-day average hit 8.7%, according to data from Aegis. At those levels, firms with sufficient balance sheet and operational infrastructure can generate meaningful yield without taking directional exposure.

Analysis

The strategy in play is a classic cash-and-carry, or basis trade: hold spot crypto while simultaneously shorting an equivalent amount via perpetual futures. The positions offset each other, leaving the trader delta-neutral but exposed to funding rate income—periodic payments that longs make to shorts when the market is bullish.

Major firms including Abraxas Capital, Fasanara Capital, and Wintermute have quietly built hundreds of millions in short perpetual futures on Hyperliquid, the onchain derivatives exchange. The three collectively hold shorts of 138,569 ETH (roughly $338 million) and 3,425 BTC (around $265 million), per onchain data tracked by Lookonchain.

At the same time, Abraxas Capital has been pulling large amounts of spot crypto off centralized exchanges. On-chain data from Arkham Intelligence shows the firm withdrew 73,872 ETH—worth approximately $173 million—from Binance over four days alone, suggesting it is holding spot to hedge its short futures exposure.

BTC funding rates remain positive and elevated across major exchanges at around 0.01% per 8 hours, according to Coinglass data. Aggregated perpetual funding sits around 0.0109% hourly for bitcoin and 0.0087% for ether, per Coinalyze—annualized yields in the high single digits that are meaningful income at institutional scale.

The trade had largely dried up as BTC's annualized perpetual funding rate spent much of February through July compressed or negative during the selloff from all-time highs above $120,000. When longs aren't paying shorts, carry stops generating income and can actually cost money to hold. This month's surge changed that equation overnight, reopening the window for basis traders.

Institutional participation has grown accordingly. CME bitcoin futures open interest climbed from roughly 87,000 BTC to 122,000 BTC in recent weeks, according to Glassnode data. Notably, CryptoQuant shows hedge funds on CME have flipped net long on bitcoin futures—a rare development given that the basis trade structurally keeps this cohort short, suggesting some are making outright directional bets rather than simply running neutral carry.

Key Numbers

- BTC perpetual funding: 0.0109% per hour (annualized ~8.7% at current rates)

- ETH perpetual funding: 0.0087% per hour

- Three firms' combined short ETH position on Hyperliquid: 138,569 ETH ($338 million)

- Three firms' combined short BTC position on Hyperliquid: 3,425 BTC ($265 million)

- Abraxas Capital ETH withdrawn from Binance in four days: 73,872 ETH ($173 million)

- CME bitcoin futures open interest increase: 87,000 to 122,000 BTC

- ETH perpetuals aggregate open interest: $14 billion (per Coinalyze)

What to Watch

The basis trade is now rich across major assets beyond Bitcoin and Ether. 21shares Capital Markets flagged this week that Solana is among the assets seeing elevated carry, suggesting the strategy has broadened.

CryptoQuant data shows hedge funds on CME have unusually flipped net long—potentially a sign that some institutional players are moving beyond neutral yield collection into directional positioning, which could amplify volatility if the trade moves against them.

Traders including @LLuciano_BTC noted that while funding has turned positive, Bitcoin has struggled to push meaningfully higher—a dynamic described as fragile. When positioning turns bullish before price confirms the move, a breakdown could flush out longs while a breakout forces shorts to chase.

@misterrcrypto flagged another concern: with crowded leveraged longs building alongside the rally, the odds of a sharp flush or pullback increase if momentum stalls, which could disrupt basis positions on both sides and trigger cascading liquidations in the carry trade itself. For firms running this at scale, managing that tail risk will be critical as funding rates normalize from current elevated levels.

The 30-day average BTC perpetual funding rate reached 6.7% annualized on Aug. 24—the first meaningful recovery since the market's drawdown—while CME open interest expansion signals institutional participation growing. Whether these conditions sustain will depend on Bitcoin's ability to hold above key technical levels in the coming weeks.