Both sides of the institutional Bitcoin futures market on the CME have reached yearly extremes. According to CryptoQuant analyst Crazzyblockk, net long positions among asset managers have fallen to $800 million: their lowest level since the launch of spot Bitcoin ETFs.
Crazzyblockk said this is the lowest reading in 124 weeks of CFTC data. The COT index for asset managers has remained at zero for five consecutive weeks. Meanwhile, the institutional long-to-short ratio stands at 1.97 to 1. This suggests the market is not in full capitulation, but rather that confidence has narrowed to its weakest level since the Bitcoin ETF launch.
What Is Happening on the Hedge Fund Side?
The other half of the picture is reflected in leveraged fund positioning, and according to the analyst, this is where many market participants get the story wrong.
The COT, or Commitment of Traders, index is based on the CFTC’s weekly report on the positions of major market participants. It measures, on a scale from 0 to 100, how close a group is to its historical long or short positioning. For leveraged funds, the index has reached 99.3, but that does not mean hedge funds are increasing their short exposure.
On the contrary, it shows that leveraged funds’ net short position has fallen to a 52-week low. Their net position improved from -$10 billion to -$1.95 billion, while gross shorts dropped by 67.5% from their all-time high, falling from $10.88 billion to $3.53 billion.
According to Crazzyblockk, funds are unwinding their basis trades. Since the launch of spot Bitcoin ETFs, leveraged funds have been net short every single week. However, this was largely cash-and-carry arbitrage, not a directional bet against Bitcoin.
Why Is This Important for the Market?
According to the analyst, BTC has fallen 48.4% from its all-time high of $121,420 in October 2025, while open interest has dropped 63.5%, from $18 billion to $6.6 billion. He argues that the fact that open interest is shrinking faster than price confirms leverage erosion rather than a spot-driven selloff.
Both institutional longs and hedge fund shorts are shrinking at the same time. This simultaneous reduction in exposure has left Bitcoin’s market structure in a positioning vacuum.
According to Crazzyblockk, the only comparable double extreme occurred in November 2022, when Bitcoin traded at $16,232 and then gained 30.3%. The mechanics are similar, but the market regime is significantly different today.
The next major move, he says, will depend on which side adds exposure first: institutional longs or basis shorts.
