Founded in 2020, UK-based Abraxas Capital Management is making a particularly aggressive bearish bet on the cryptocurrency market. The firm has so far bet close to $500 million on Bitcoin, Ethereum, and numerous altcoins going down. This trend demonstrates their wait for increased volatility and more severe market pullbacks. Total crypto market capitalization has tanked by almost $10 billion, as of June 17. In the meantime, Bitcoin has crashed more than 7% from its latest all-time-high.
Abraxas Capital Management’s bearish portfolio is heavily weighted towards the two largest cryptos. The firm has put $224 million into shorting Bitcoin and $163 million into shorting Ethereum. These shorts constitute the heart of its expected bearish strategy. They indicate a robust belief that substantial price drops are imminent for these two most prominent digital assets.
Looking further than Bitcoin and Ethereum, Abraxas Capital Management has set its sights on other specific altcoins with short positions as well. The firm currently has $57 million in shorts on HYPE and $44 million on Solana (SOL). On top of that, it maintains a $560,000 short position against SUI.
Even though it’s made its name with its sizeable short positions, Abraxas Capital Management has placed bets of about $488 million on a slew of crypto assets. That points to a more nuanced approach that pairs bearish bets with selective investments in growth sectors. The company has already made profits of at least $13.3 million from its speculative bet.
The broader crypto market faces renewed skepticism as Abraxas Capital Management positions itself for continued turbulence. The firm expects for volatility to increase and corrections to be greater into 2022, especially for Bitcoin and Ethereum. This particularly bearish stance is taking part in the continuing argument on whether or not the recent crypto market rally is a sustainable one.
