@lenaralph
When BTC futures move into backwardation, it often signals strong spot selling pressure. Traders unwilling to pay premium for futures reveal bearish sentiment or funding strain. Modeling must integrate funding costs, collateral yields, and borrow rates, since arbitrageurs balance cash-and-carry economics. Higher borrow rates amplify backwardation by raising hedging costs. Thus, incorporating real-time lending market data alongside futures spreads refines predictive models. In practice, backwardation alone is insufficient; combined with spot outflows and margin stress indicators, it provides a sharper signal of liquidation-driven selling waves.
0 reply
0 recast
0 reaction