PANews reported on March 17 that according to analysis by Augustine Fan, head of SignalPlus, the recent Bitcoin sell-off was mainly triggered by multi-strategy hedge fund transactions that dominate the macro market. These multi-strategy transactions include arbitrage, long and short positions, and leverage operations, aiming to maximize returns across asset classes.
In the Bitcoin market, a common multi-strategy trading method is basis trading, which is to profit from the price difference by buying spot Bitcoin (usually through ETFs) and shorting Bitcoin futures. However, when the price difference narrows or the market changes, the profit of basis trading decreases, causing funds to exit positions and sell Bitcoin and ETF shares in a concentrated manner. Fan pointed out that this liquidation pressure has amplified the selling in the past week, especially against the backdrop of increased tariff-related volatility.
Despite this, the "buy on dips" sentiment in the market still exists. Fan said that stock valuations outside the major large-cap stocks are still relatively stable compared to the historical average, and hard economic data may be better than the rapid deterioration of soft data. Therefore, the market generally believes that it is still a "buy on dips" market, and it is expected to gradually digest the impact of tariff fluctuations.
