BitMEX Alpha: Cashout and Carry via Dated Futures

Note: Nothing expressed below should be considered financial advice. This is just a suggestion so that users can learn more about the trading strategy. Users are always encouraged to do as much research as possible before executing any trade. The information below is not intended to represent guaranteed returns, and BitMEX is not responsible if your trades do not perform as expected.

A few days ago, Bitcoin finally hit a new all-time high of 69,409.5 (as printed on the XBTUSD contract). As much as we would like to see more ATH here on BitMEX Alpha, we have other opportunities as well.

With the recent cryptocurrency market excitement fueled by the return of retail traders, strong inflows into Bitcoin ETFs, and heightened expectations of an imminent interest rate cut, futures contracts are trading at a significant premium to the spot market.

This represents a good basis trading opportunity for our dated futures. It’s simple. Secure basis by buying spot, selling futures, and holding until the contract expiration date!

We have put together a list of futures contracts that you can trade alongside spot on BitMEX to make money. Of note is the ETHUSDTH24 contract with an 80% annualized rate this week, with ETH continuing to hit new yearly highs against ETF expectations.

Are you already actively trading on BitMEX and want more capital to execute these profitable basic trades? Apply for Margin+, which gives you additional Bitcoin or Tether so you can make more transactions. Learn more about Margin+ here.

What’s on the table?

The table below lists BitMEX’s dated futures contracts and the basis they can earn (%)*.

*Note: Figures were captured at the time of writing.

How do you execute on an opportunity?

1. Buy (long) tokens spot or in conversion.
2. Tokens are sold (shorted) through futures contracts.
3. To realize the captured basis, hold the futures contract until expiration.
4. Sell ​​spot tokens upon expiration.

For step-by-step guidance on basis trading (futures contract vs. spot), see “1. Future Transactions vs. “Spot trading”. article.

What is the profit potential?

Any captured base will be to your benefit. Please note that you must hold your trade until the futures contract expires to realize the full amount.

What should I consider?

• Exit and entry costs (e.g. trading fees and slippage) for both trades.
• There is execution risk when simultaneously trading spot and futures contracts, especially during volatile market periods.
• Considering that you can trade up to 100x on the contracts mentioned above, there is a risk of liquidation. If the market price rises above the liquidation price, your position may be liquidated, leaving you exposed to an unhedged spot position. If you choose to use high leverage for your trading, you should monitor market conditions closely and top up your wallet to meet margin requirements. Alternatively, you may choose to trade with lower leverage to reduce liquidation risk.

For Quanto Futures

• To purchase Spot, you need USDT (Tether). Additional XBT (Bitcoin) is required as margin for perpetual contracts.
• Keep in mind that the Quanto contract is margined and settled in Bitcoin (XBT), so you are still exposed to XBT/USD price risk when trading the Quanto contract. To hedge your price risk, you may consider selling XBTUSD or XBTUSDT contracts.

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