According to BlockBeats, on August 20, Ethereum recently surged to nearly 5,000 USD, triggering a wave of upward momentum. However, this threshold failed to be breached, as sellers regained dominance, pushing the price back downward. A significant portion of the downward pressure appears to come from large hedge funds that continue to short this second-largest cryptocurrency at record levels.
When the price of Ethereum stands above 4,000 USD, short positions increase as many anticipate a weakening of upward momentum. A large number of short positions are dominated by major hedge funds, exacerbating the downward pressure on Ethereum. This is not the first time, as hedge funds have been trying to suppress the ETH price to reduce their own losses.
According to The Block's 'CME Ether Futures Net Positions' dashboard, these short data have risen to historic highs. For hedge funds alone, short positions nearly doubled in August. Data shows that on August 5, the short position led by hedge funds in Ethereum was 2.3 billion USD. However, in the latest report, this figure rapidly grew to 4.19 billion USD, indicating that hedge funds are still betting on a decline in ETH prices.
In contrast to hedge funds, asset management companies remain relatively optimistic about Ethereum. Data shows they continue to hold over 1.22 billion USD in long positions. Although this scale is considerable, it is still below short positions, indicating that shorts still dominate. Unreported positions maintain a long position of 77.5 million USD. Meanwhile, investors classified as 'others' (typically including retail investors, etc.) hold a short position of 397.5 million USD, 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 historic highs, historical trends suggest that such periods often lead to short squeezes, potentially driving prices into a new round of increases.
