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0xSun: Long ETH and Short Shitcoin Hedge Strategy currently has an overall profit of about 16%, although the price increase is not as high as ETH, the risk is lower.
BlockBeats News, August 13th, Smart Money, crypto KOL 0xSun (@0xSunNFT) stated that on August 1st, the Ethereum price was around $3700, and it has now risen to $4660, a 26% increase. The short positions in altcoins saw a concentrated increase of 5% to 15%, with an overall profit margin of about 16%. Compared to naked long Ethereum, a hedging strategy faces less psychological pressure in the face of a downturn, especially since Ethereum had dropped to $3360, where naked long positions might have been stopped out. However, during hedging, altcoins usually experience larger drops than Ethereum, but the overall profit can still be enhanced, providing a better holding experience.
Previously reported on August 1st, 0xSun mentioned that the current market sentiment is heavily divided between longs and shorts. He has personally opened a hedging trade (long ETH and short a basket of altcoins), with a position ratio of approximately 1:1, believing that institutional buying of ETH will not overflow into other altcoins.
If the market continues its bullish trend in the second half of the year, he believes there is a high probability that it will still be driven by ETH. In the event of a bear market, he also does not believe that altcoins can stand alone, while at least ETH has institutional buying power to support it. The situation that would render this hedging strategy ineffective would either be if the altcoin season truly arrives, with most altcoins consistently outperforming ETH, or if ETH oscillates or leads the decline while other altcoins do not experience significant drops. Based on the experience of the past few months, he personally believes that the latter scenario is less likely.
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