3 Crypto Basis Trading Strategies on BitMEX Explained

BitMEX offers three core crypto basis trading strategies. They enable traders to earn interest income without taking Bitcoin price risk. The first strategy, cash and carry, involves buying spot BTC and shorting the XBTU23 futures contract. This locks in a positive basis spread for a guaranteed return at expiry. The second strategy uses the perpetual swap XBTUSD. By holding spot BTC and shorting the swap, traders capture the funding rate when it is positive. The third strategy executes curve trades between futures and swaps. Curve flattening sells futures and buys swaps if the basis curve is expected to narrow. Curve steepening buys futures and sells swaps when the curve is set to widen. All crypto basis trading strategies eliminate Bitcoin directional risk by hedging spot and derivative positions. Traders must manage margin and leverage to avoid liquidation. Professional traders use these basis trading strategies for steady, volatility-adjusted yields on BitMEX.