According to BlockBeats, on August 20, Ethereum recently surged to nearly $5,000, triggering a wave of bullish momentum. However, this threshold was not breached, as sellers regained dominance and pushed the price back down. A significant portion of the downward pressure seems to come from major hedge funds, which continue to short this second-largest cryptocurrency at record levels.
When the price of Ethereum surged above $4,000, short positions also increased, with many expecting upward momentum to weaken. A large number of short positions are dominated by major hedge funds, thereby intensifying the downward pressure on Ethereum. This is not the first time, as hedge funds have consistently tried to suppress ETH prices to minimize their own losses.
According to The Block's 'CME Ether Futures Net Position' dashboard, these short data have risen to a historical high. For hedge funds alone, short positions nearly doubled in August. Data shows that on August 5, the short position led by hedge funds was $2.3 billion. However, in the latest report, this number quickly grew to $4.19 billion, indicating that hedge funds are still betting on a decline in ETH prices.
Contrary to hedge funds, asset management companies remain relatively optimistic about Ethereum. Data shows they continue to hold over $1.22 billion in long positions. Although this scale is considerable, it is still lower than short positions, indicating that shorts remain dominant. Unreported positions maintain a long of $77.5 million. Meanwhile, investors classified as 'others' (typically including retail investors, etc.) hold a short position of $397.5 million, adding more downward pressure to the market.
For hedge funds, an increase in ETH price means losses, while a decrease means profits. However, with short positions at historically high levels, historical trends suggest that such periods often lead to short squeezes, which can drive prices up in a new round.
