Abraxas Capital's ETH Short Exposure Drives 190M USD Unrealized Loss, While Funding Strategies Yield 28M USD

On-chain tracking reveals that Abraxas Capital maintains substantial bearish positions across multiple major assets through two coordinated accounts, with cumulative unrealized losses reaching 190 million USD. The fund’s most significant exposure centers on Ethereum, where it has accumulated 113,819 ETH (currently valued at approximately 483 million USD) in short positions, generating losses exceeding 144 million USD at recent price levels.

Beyond Ethereum, Abraxas Capital is shorting Bitcoin, Solana, Hyperliquid, and Sui, expanding its downside bets across the broader digital asset ecosystem. Despite the substantial paper losses on these positions, an important context reshapes the narrative: prior analysis suggests these short positions function as sophisticated spot hedging mechanisms rather than pure directional trades.

The Funding Rate Revenue Model

A critical detail often overlooked in loss discussions is the consistent income generated through funding rate capture. Abraxas Capital’s short positions have accumulated over 28 million USD in funding rate income, which serves as an offset mechanism to unrealized drawdowns. This strategy reflects a nuanced approach where the fund simultaneously captures market-driven yield while maintaining protective hedges.

Historical Context and Market Dynamics

During market downturns, these same short positions have historically realized significant gains, suggesting they serve a dual purpose: protecting spot holdings during volatility while generating passive income through perpetual futures funding premiums. The distinction between unrealized losses and the protective function these positions provide is crucial for understanding the fund’s true risk exposure.

The current snapshot of 190 million USD in cumulative unrealized losses must therefore be contextualized within this broader hedging framework, where funding income and downside protection create a more complex risk-return profile than headline losses alone suggest.