Abraxas Capital builds $783M short positions on Hyperliquid, hedges with $173M in ETH withdrawals

Abraxas Capital, a London-based digital assets firm managing over $4 billion, has assembled a staggering short position portfolio on Hyperliquid while simultaneously withdrawing $173.17 million in Ethereum from Binance over four days. The dual-pronged strategy paints a picture of a firm betting aggressively on price declines across major tokens while keeping a hefty spot cushion to manage risk.

The numbers are eye-catching. Across two wallets on Hyperliquid’s decentralized perpetual futures platform, Abraxas holds roughly $598 million in predominantly short positions. That includes $193.9 million short on ETH, $175.4 million short on Bitcoin, $141.6 million short on Hyperliquid’s native HYPE token, and $65.8 million short on Solana.

A whale that keeps adding weight

Abraxas isn’t just sitting on these positions. The firm has been actively increasing exposure, adding approximately $19.5 million in gross shorts within a two-hour window recently.

Since mid-2025, the firm has consistently maintained short exposure ranging from $500 million to over $900 million on Hyperliquid, frequently ranking as the platform’s largest single whale. At its peak, the short book reportedly exceeded $900 million.

Right now, the trade isn’t exactly printing money. Abraxas is carrying an unrealized loss of $80.8 million across its positions.

The $173 million in ETH withdrawals from Binance supports that read, as the spot purchases serve as a natural hedge against the short perpetual exposure.

Funding rate arbitrage, not a doomsday bet

The firm has realized profits exceeding $300 million, primarily through funding-rate arbitrage rather than pure directional trading. The strategy works like this: when perpetual futures trade at a premium to spot prices, shorts collect periodic funding payments from longs. By pairing short perp positions with nearly equal spot purchases of the underlying asset, Abraxas can harvest those funding payments while staying roughly market-neutral.

This approach has been particularly visible in how Abraxas handles its HYPE exposure. The firm has paired its $141.6 million HYPE short with spot purchases of the token, creating a hedged position that profits from the funding rate differential rather than from HYPE’s price falling.

The ETH withdrawals from Binance fit the same pattern. Pulling $173.17 million in ETH to cold storage or self-custody wallets while holding $193.9 million in ETH shorts creates a nearly balanced book.

What this signals for the broader market

Abraxas has demonstrated flexibility before. The firm reduced its short exposure from $760 million in November 2025 down to approximately $270 million, showing it’s willing to cut and re-enter rather than ride positions into oblivion. The current buildup back toward $600 million suggests the firm sees favorable funding-rate conditions worth capturing at scale.

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