Bearish Sentiment Drives IP Futures Premium to 10%

The price of IP contracts on major centralized exchanges (CEXs) is currently approximately 10% higher than the spot price, indicating a significant premium in the futures market. This discrepancy is likely due to the high demand for short positions, as evidenced by the funding rates for IP futures trading pairs on these platforms reaching their maximum negative values.

According to data from Coinglass, the current price difference between IP futures contracts on CEX and spot is around 10%. The funding rates for IP futures trading pairs on major CEXs have all reached their lowest limits, indicating that a majority of traders in the market are either shorting IP or hedging their positions. This includes:

• Binance, with a rate of -2% and a position size of 52 million USD
• Bybit, with a rate of -0.75% and a position size of 48.91 million USD
• OKX, with a rate of -1.5% and a position size of 40.49 million USD

The total open interest for IP contracts across all platforms has reached 213 million USD, with a 24-hour contract trading volume of 3.62 billion USD.

This situation suggests that the market is experiencing a high level of bearish sentiment, with traders anticipating a decline in the price of IP. The significant premium in the futures market may be a result of this bearish sentiment, as traders are willing to pay a higher price to short IP in the future.

However, it is essential to note that the current funding rates and price discrepancies may not necessarily indicate the future direction of the IP market. Market conditions can change rapidly, and traders should remain vigilant and adapt their strategies accordingly.