27 Sep 2022
Short ETF exposure nearing all-time highs
ProShares’ short BTC ETF’s AUM has climbed towards new highs as more traders seek to speculate on downside in BTC, with BTC trailing near range lows.
On Friday September 23rd, BITI’s BTC equivalent short exposure grew to 5,270 BTC. This is the third highest short exposure held by BITI since launching in June. From BITI, an interesting pattern has emerged. Spiking exposure tends to coincide with market bottoms, while sharply declining exposure tends to coincide with local price peaks. This either suggests that ETF traders on aggregate trade poorly in the ranging market, shorting near lows and closing near highs. However, the situation may be more intricate, with ETF flow directly impacting CME’s basis with spill-over effects to the spot market. Thus, flows of BITI positions may also be a dynamic that leads markets to recover. BITI’s exposure topped near a short equivalent of 4,000 BTC throughout the summer but has seen new highs above 5,000 BTC this autumn. Overall, this points in the direction of increased demand to make bearish bets on BTC.