Institutional arbitrage strategies fueled Ethereum futures short positions to reach $1.6 billion in June, marking a record high.
The widening yield spread between ETH spot prices and futures contracts served as the primary driver for this activity. This spread escalated from 6% in February to 8–9% by May and June, significantly amplifying arbitrage opportunities.
Coinbase Institutional’s Research Director, David Duong, cautioned against misinterpreting the substantial short position without context. Duong emphasized that concurrent inflows into Ethereum ETFs totaling $1.16 billion provide crucial counterbalance, suggesting broader institutional engagement beyond betting on price declines.
Despite the significant futures activity, Ethereum demonstrated robust market performance. Its price stabilized around $2,507, boasting a market capitalization exceeding $300 billion and reflecting a 42% surge over the preceding three months.
Growing regulatory clarity and the ongoing implementation of Ethereum’s network enhancements continue to solidify its appeal as a foundational asset within institutional portfolios.