Markets Share Share this article Copy linkX (Twitter)LinkedInFacebookEmail Bitcoin Futures Return to Deepest Markets Share Share this article Copy linkX (Twitter)LinkedInFacebookEmail Bitcoin Futures Return to Deepest

Bitcoin Futures Return to Deepest 'Backwardation' Since FTX Collapse Hinting Possible Bottom

2025/12/04 00:54
5 min read
Share
Share this article
Copy linkX (Twitter)LinkedInFacebookEmail

Bitcoin Futures Return to Deepest 'Backwardation' Since FTX Collapse Hinting Possible Bottom

So-called "backwardation" — a futures price curve moving lower in value as time gets further out — can be read as a measure of stress in the market.

By James Van Straten|Edited by Stephen Alpher
Updated Dec 3, 2025, 6:04 p.m. Published Dec 3, 2025, 4:54 p.m.
BTC CME Annualized Basis (Velo)

What to know:

  • Backwardation signals that futures prices are now below near term levels, reflecting cautious forward pricing and weakened expectations among institutional traders.
  • The structure often emerges during forced de-risking and has historically appeared near major or local bottoms.

The CME bitcoin annualised basis has fallen to -2.35% its deepest backwardation since the extreme dislocations of the FTX collapse in November 2022, when the basis briefly approached -50%, according to Velo data.

Backwardation describes a futures curve in which contracts that expire sooner trade at a higher price than contracts that expire later. In other words, the market is pricing bitcoin in the future at a lower level than the current or near term price. This creates a downward sloping futures curve and signals that traders expect weaker prices as time passes.

This structure is typically unusual in bitcoin because bitcoin futures almost always trade at a premium, known as contango, reflecting the cost of leverage and strong demand for forward exposure.

The move recently into backwardation first flashed around Nov. 19, just two days before bitcoin bottomed around $80,000 on Nov. 21. In this recent correction a considerable amount of leverage has been flushed from the system, with traders unwinding long futures and institutions reducing exposure.

STORY CONTINUES BELOW
Don't miss another story.Subscribe to the Crypto Daybook Americas Newsletter today. See all newsletters
Sign me up

Backwardation has historically appeared at moments of stress or forced de-risking, and previous episodes in November 2022, March 2023, August 2023 and now November 2025 aligned closely with major or local market lows.

However, backwardation does not automatically imply a bullish inflection. As highlighted in earlier CoinDesk research, bitcoin is not comparable to physical commodities like oil where backwardation reflects tight supply. CME futures are cash settled, heavily used by institutions running basis trades, and can slip deeper into negative territory.

In this view, backwardation represents cautious forward pricing and weaker expectations rather than near term spot demand strength.

A large portion of leverage has already evaporated but conditions can always worsen if risk appetite deteriorates further. At the same time, this is the same structure that has repeatedly marked turning points once forced sellers exhaust themselves. Bitcoin is therefore entering a zone where both danger and opportunity have historically emerged.

Bitcoin NewsCMECME Futures

More For You

Protocol Research: GoPlus Security

Commissioned byGoPlus

What to know:

  • As of October 2025, GoPlus has generated $4.7M in total revenue across its product lines. The GoPlus App is the primary revenue driver, contributing $2.5M (approx. 53%), followed by the SafeToken Protocol at $1.7M.
  • GoPlus Intelligence's Token Security API averaged 717 million monthly calls year-to-date in 2025 , with a peak of nearly 1 billion calls in February 2025. Total blockchain-level requests, including transaction simulations, averaged an additional 350 million per month.
  • Since its January 2025 launch , the $GPS token has registered over $5B in total spot volume and $10B in derivatives volume in 2025. Monthly spot volume peaked in March 2025 at over $1.1B , while derivatives volume peaked the same month at over $4B.
View Full Report

More For You

Filecoin Gains 2% Alongside Crypto Rally

The token tracked broader crypto sentiment on below-average volume, establishing an ascending trend.

What to know:

  • FIL gained 2% to $1.57, staying tightly correlated with broader crypto markets.
  • Trading volume remained muted at 9.7% above weekly averages, signaling limited conviction.
Read full story
Latest Crypto News

Filecoin Gains 2% Alongside Crypto Rally

Ethereum's 'Fusaka' Upgrade Cements Network's Role as On-Chain Finance Settlement Layer: Bitwise

The Protocol: Ethereum Preps For Upcoming Fusaka Upgrade

Trump's CFTC, FDIC Picks Closer to Taking Over Agencies as They Advance in Senate

Firelight Introduces XRP Staking for DeFi Insurance Layer Against Exploits

ETHZilla Buys 20% of AI Lending Platform Karus in $10M Deal to Tokenize Auto Loans

Top Stories

Crypto Rally Stumbles, Bitcoin Slips Back to $92K, on MicroSoft AI Sales Report

Trump's CFTC, FDIC Picks Closer to Taking Over Agencies as They Advance in Senate

U.S. Debt Growth Will Drive Crypto's Gains, BlackRock Says in Report on AI

Strategy Faces Possible MSCI Index Removal, Threatening Billions in Outflows: Reuters

Kalshi’s Luana Lopes Lara Becomes Youngest Female Self-Made Billionaire

IREN Investors Mull Outlook After $3.6B Capital Raise as Jim Cramer Says 'Sell'

Disclaimer: The articles reposted on this site are sourced from public platforms and are provided for informational purposes only. They do not necessarily reflect the views of MEXC. All rights remain with the original authors. If you believe any content infringes on third-party rights, please contact service@support.mexc.com for removal. MEXC makes no guarantees regarding the accuracy, completeness, or timeliness of the content and is not responsible for any actions taken based on the information provided. The content does not constitute financial, legal, or other professional advice, nor should it be considered a recommendation or endorsement by MEXC.

You May Also Like

The Role of Blockchain in Building Safer Web3 Gaming Ecosystems

The Role of Blockchain in Building Safer Web3 Gaming Ecosystems

The gaming industry is in the midst of a historic shift, driven by the rise of Web3. Unlike traditional games, where developers and publishers control assets and dictate in-game economies, Web3 gaming empowers players with ownership and influence. Built on blockchain technology, these ecosystems are decentralized by design, enabling true digital asset ownership, transparent economies, and a future where players help shape the games they play. However, as Web3 gaming grows, security becomes a focal point. The range of security concerns, from hacking to asset theft to vulnerabilities in smart contracts, is a significant issue that will undermine or erode trust in this ecosystem, limiting or stopping adoption. Blockchain technology could be used to create security processes around secure, transparent, and fair Web3 gaming ecosystems. We will explore how security is increasing within gaming ecosystems, which challenges are being overcome, and what the future of security looks like. Why is Security Important in Web3 Gaming? Web3 gaming differs from traditional gaming in that players engage with both the game and assets with real value attached. Players own in-game assets that exist as tokens or NFTs (Non-Fungible Tokens), and can trade and sell them. These game assets usually represent significant financial value, meaning security failure could represent real monetary loss. In essence, without security, the promises of owning “something” in Web3, decentralized economies within games, and all that comes with the term “fair” gameplay can easily be eroded by fraud, hacking, and exploitation. This is precisely why the uniqueness of blockchain should be emphasized in securing Web3 gaming. How Blockchain Ensures Security in Web3 Gaming?
  1. Immutable Ownership of Assets Blockchain records can be manipulated by anyone. If a player owns a sword, skin, or plot of land as an NFT, it is verifiably in their ownership, and it cannot be altered or deleted by the developer or even hacked. This has created a proven track record of ownership, providing control back to the players, unlike any centralised gaming platform where assets can be revoked.
  2. Decentralized Infrastructure Blockchain networks also have a distributed architecture where game data is stored in a worldwide network of nodes, making them much less susceptible to centralised points of failure and attacks. This decentralised approach makes it exponentially more difficult to hijack systems or even shut off the game’s economy.
  3. Secure Transactions with Cryptography Whether a player buys an NFT or trades their in-game tokens for other items or tokens, the transactions are enforced by cryptographic algorithms, ensuring secure, verifiable, and irreversible transactions and eliminating the risks of double-spending or fraudulent trades.
  4. Smart Contract Automation Smart contracts automate the enforcement of game rules and players’ economic exchanges for the developer, eliminating the need for intermediaries or middlemen, and trust for the developer. For example, if a player completes a quest that promises a reward, the smart contract will execute and distribute what was promised.
  5. Anti-Cheating and Fair Gameplay The naturally transparent nature of blockchain makes it extremely simple for anyone to examine a specific instance of gameplay and verify the economic outcomes from that play. Furthermore, multi-player games that enforce smart contracts on things like loot sharing or win sharing can automate and measure trustlessness and avoid cheating, manipulations, and fraud by developers.
  6. Cross-Platform Security Many Web3 games feature asset interoperability across platforms. This interoperability is made viable by blockchain, which guarantees ownership is maintained whenever assets transition from one game or marketplace to another, thereby offering protection to players who rely on transfers for security against fraud. Key Security Dangers in Web3 Gaming Although blockchain provides sound first principles of security, the Web3 gaming ecosystem is susceptible to threats. Some of the most serious threats include:
Smart Contract Vulnerabilities: Smart contracts that are poorly written or lack auditing will leave openings for exploitation and thereby result in asset loss. Phishing Attacks: Unintentionally exposing or revealing private keys or signing transactions that are not possible to reverse, under the assumption they were genuine transaction requests. Bridge Hacks: Cross-chain bridges, which allow players to move their assets between their respective blockchains, continually face hacks, requiring vigilance from players and developers. Scams and Rug Pulls: Rug pulls occur when a game project raises money and leaves, leaving player assets worthless. Regulatory Ambiguity: Global regulations remain unclear; risks exist for players and developers alike. While blockchain alone won’t resolve every issue, it remediates the responsibility of the first principles, more so when joined by processes such as auditing, education, and the right governance, which can improve their contribution to the security landscapes in game ecosystems. Real Life Examples of Blockchain Security in Web3 Gaming Axie Infinity (Ronin Hack): The Axie Infinity game and several projects suffered one of the biggest hacks thus far on its Ronin bridge; however, it demonstrated the effectiveness of multi-sig security and the effective utilization of decentralization. The industry benefited through learning and reflection, thus, as projects have implemented changes to reduce the risks of future hacks or misappropriation. Immutable X: This Ethereum scaling solution aims to ensure secure NFT transactions for gaming, allowing players to trade an asset without the burden of exorbitant fees and fears of being a victim of fraud. Enjin: Enjin is providing a trusted infrastructure for Web3 games, offering secure NFT creation and transfer while reiterating that ownership and an asset securely belong to the player. These examples indubitably illustrate that despite challenges to overcome, blockchain remains the foundational layer on which to build more secure Web3 gaming environments. Benefits of Blockchain Security for Players and Developers For Players: Confidence in true ownership of assets Transparency in in-game economies Protection against nefarious trades/scams For Developers: More trust between players and the platform Less reliance on centralized infrastructure Ability to attract wealth and players based on provable fairness By incorporating blockchain security within the mechanics of game design, developers can create and enforce resilient ecosystems where players feel reassured in investing time, money, and ownership within virtual worlds. The Future of Secure Web3 Gaming Ecosystems As the wisdom of blockchain technology and industry knowledge improves, the future for secure Web3 gaming looks bright. New growing trends include: Zero-Knowledge Proofs (ZKPs): A new wave of protocols that enable private transactions and secure smart contracts while managing user privacy with an element of transparency. Decentralized Identity Solutions (DID): Helping players control their identities and decrease account theft risks. AI-Enhanced Security: Identifying irregularities in user interactions by sampling pattern anomalies to avert hacks and fraud by time-stamping critical events. Interoperable Security Standards: Allowing secured and seamless asset transfers across blockchains and games. With these innovations, blockchain will not only secure gaming assets but also enhance the overall trust and longevity of Web3 gaming ecosystems. Conclusion Blockchain is more than a buzzword in Web3; it is the only way to host security, fairness, and transparency. With blockchain, players confirm immutable ownership of digital assets, there is a decentralized infrastructure, and finally, it supports smart contracts to automate code that protects players and developers from the challenges of digital economies. The threats, vulnerabilities, and scams that come from smart contracts still persist, but the industry is maturing with better security practices, cross-chain solutions, and increased formal cryptographic tools. In the coming years, blockchain will remain the base to digital economies and drive Web3 gaming environments that allow players to safely own, trade, and enjoy their digital experiences free from fraud and exploitation. While blockchain and gaming alone entertain, we will usher in an era of secure digital worlds where trust complements innovation. The Role of Blockchain in Building Safer Web3 Gaming Ecosystems was originally published in Coinmonks on Medium, where people are continuing the conversation by highlighting and responding to this story
Share
Medium2025/09/18 14:40
Fintech Is Leveling the Playing Field in Trading, Says Zak Westphal

Fintech Is Leveling the Playing Field in Trading, Says Zak Westphal

The post Fintech Is Leveling the Playing Field in Trading, Says Zak Westphal appeared on BitcoinEthereumNews.com. The trading world was once divided into two groups: those with access to high-powered data and those without.  As you might have guessed, it was the major institutions (like Wall Street) that had a monopoly on the tools, data access, and speed. This left retail traders fighting to keep up. This gap is closing rapidly, and the main reason is the introduction of new technology and platforms entering the fold. Zak Westphal has been at the forefront of this transformation. While Co-Founding StocksToTrade, he has been a big part of empowering everyday traders to gain access to the real-time information and algorithmic systems that have long provided Wall Street with its edge. We spoke with him about how fintech is reshaping the landscape and what it really means for retail traders today. Fintech has changed everything from banking to payments. In your opinion, what has been its greatest impact on the world of trading? For me, it’s all about access. When I began my trading career, institutions had a significant advantage, even more pronounced than it is now. They had direct feeds of data, algorithmic systems, and research teams monitoring information right around the clock. Retail traders, on the other hand, had slower information and pretty basic tools in comparison.  Fintech has substantially changed the game. Today, a retail trader from home can access real-time market data, scan thousands of stocks in mere seconds, and utilize algorithmic tools that were once only available to hedge funds. I can’t think of a time when the access for everyday traders has been as accessible as it is today. That doesn’t mean the advantages are gone, because Wall Street still has resources that individuals simply can’t have. However, there is now an opportunity for everyday traders actually to compete. And that is a…
Share
BitcoinEthereumNews2025/09/18 17:14
SAP Proposes Dividend of €2.50 per Share

SAP Proposes Dividend of €2.50 per Share

WALLDORF, Germany, Feb. 19, 2026 /PRNewswire/ — The Supervisory Board and Executive Board of SAP SE (NYSE: SAP) recommend that shareholders approve a dividend of
Share
AI Journal2026/02/19 15:30