Opinion: Bitcoin derivatives hedging demand reaches a historic extreme, signaling a contrarian long opportunity

According to Odaily, Matthew Sigel, Head of Research at VanEck, posted an analysis on the X platform, noting that current protective demand in the Bitcoin derivatives market has risen to the 99th historical percentile, which is typically seen as a “contrarian bullish signal” under conditions of extreme risk aversion, and judges that the market is currently suitable for establishing long positions.

The VanEck Digital Transformation ETF (NODE), which Matthew Sigel also manages, has risen 27% since its inception, while Bitcoin fell 33% over the same period. The ETF achieved lower volatility performance through diversified allocation and a focus on profitable sectors. However, he also warned that if companies' large capital expenditures in the field of artificial intelligence (AI) do not generate corresponding returns, this could pose substantial pressure on the market, especially against the backdrop of weightings concentrated in S&P 500 constituent stocks.

Note: Percentile is a concept of statistical position; the 99th percentile represents a relatively extreme level, and the 50th percentile represents the median level.