Recent Ethereum preparations for the highest level ever have successfully sparked a wave of bullish momentum that threatened to break the $5,000 level. However, this was not the case as the sellers were able to control again and brought the price back down. Most of this bearish pressure appears to be driven by large hedge funds that continue to wager on cryptocurrencies, the second largest by record market capitalization.
Ethereum Shorts reaches recording level
With Ethereum prices exceeding $4,000, the shorts are stacked up, and many hope that the gathering will run out of steam. Most of the time, these short numbers are driven by large hedge funds, pushing down Ethereum prices. This is not the first time that hedge funds have tried to continually curb ETH prices to minimize end losses.
These short numbers have actually risen to levels not previously seen, according to data from the net positions on the CME Ether Futures dashboard on the Block website. With hedge funds alone, short positions almost doubled in August.
As the website shows, the total number of hedge fund-led Ethereum shorts sat at $2.3 billion on August 5th. However, this figure quickly grew to $4.19 billion at the time of this report. This suggests that hedge funds still hope that Ethereum prices will collapse from here.
Other positions in ETH
In contrast to hedge funds, asset managers remain fairly bullish at Ethereum. The data shows that it was positively long Ethereum at the time of this report, rising to more than $1.22 billion. This is noticeable, but it still doesn’t reach the bearish position and shows that more shorts are happening.
The unreported position remains positive at $77.5 million. On the other hand, there are “other” positions. This often covers retail and more, and is negative at $397.5 million, adding fuel to the ongoing shorts.
For hedge funds, the higher the price of Ethereum, the more money you lose and the lower the price, the more money you get. However, due to its short position at a record level, historical performance suggests that such shorter time apertures can be achieved and prices could rise as a result.
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