Abraxas Capital has acquired 13,000 ETH worth approximately $32.39 million in the spot market, paired against a 141,180 ETH short position on Hyperliquid valued near $353.27 million. The purchase, made on September 8, represents a continuation of the fund's hedging strategy first documented in late August.
The London-based firm, which manages over $4 billion in assets, is holding both legs of the position simultaneously rather than closing either side. This approach reflects a market-neutral trading structure in which spot purchases are designed to limit losses if the short position moves unfavorably.
How Market-Neutral Positioning Works
In this strategy, the fund pairs short derivatives exposure against separate spot holdings to capture the spread between them rather than betting on directional price movement. On perpetual futures venues like Hyperliquid, this spread often comes from funding payments that shorts collect when traders crowd the long side of the market.
The fund's August activity shows the position has grown rather than unwound. At that time, Abraxas built a $783 million Hyperliquid short and hedged it by withdrawing 73,872 ETH from Binance. Fasanara Capital and Wintermute operated similar strategies during the same period, holding short positions valued near $338 million and $265 million respectively.
Risks in Hedged Trading
Market-neutral positions carry specific failure modes. Basis risk emerges when spot and perpetual prices diverge sharply during volatile market moves, exactly when protection is most needed. A negative funding rate flip can also convert a profitable carry trade into a losing one by reversing the payment direction. Additionally, the underlying venue itself carries leverage risk; Hyperliquid has experienced repeated liquidations, including a 23x leveraged ETH short near its liquidation threshold.
Ether is currently trading near $2,480, within a range maintained for weeks, while bitcoin has remained below $80,000 ahead of U.S. inflation data. Flat market conditions are the environment in which carry trades typically operate.
