Market maker Wintermute shifts to defensive strategy: $123 million portfolio 70% Short Position, SOL funding rate turns negative raising alarm

As the crypto market experiences heightened fluctuations, the top market maker Wintermute is quietly shifting towards defensive strategies. In its $123 million portfolio, short positions account for as much as 70%, heavily betting on the fall of mainstream tokens such as ETH and SOL, while also securing a staggering 127% and 78% return rate on short orders for TRUMP and XRP respectively. Despite most traders in the derivation market still holding long positions, the unusual movement of Solana's funding rate turning negative and a 25% drop in open contracts creates a dangerous resonance with Wintermute's $14.7 million SOL short order. This article will deeply analyze the market signals behind Wintermute's defensive repositioning and warn of the high open contract traps for small-cap tokens (like Fartcoin, PUMP).

( Wintermute Defensive Portfolio: short order dominated precision strike ) Facing a volatile market, Wintermute's $123 million position shows a clear defensive stance: nearly 70% of the top assets are short positions, retaining only Bitcoin (BTC), Sui (SUI), Dogecoin (DOGE), and the S&P 500 index (SPX) as long positions. Among them, the $10.38 million BTC long position (20x leverage) contributed a 13.95% return, but it pales in comparison to its short performance — shorting the Trump concept coin TRUMP made a huge profit of 127.99%, and betting against XRP yielded a profit of 78.11%. This demonstrates Wintermute's precise ability to capture downward trends, with its $26 million ETH short position (15x leverage) showing an unrealized gain of 27.33%, further highlighting its deep skepticism about the short-term movements of altcoins.

( The goal of empty positions is aimed at blue chips: cautious sentiment spreads in the market ) Wintermute's significant short order is targeting blue-chip tokens such as Ethereum ( ETH ), Solana ( SOL ), and Curve ( CRV ), reflecting the general pessimism of institutions towards the rebound of altcoins. Notably, the $14.7 million SOL short position poses a dangerous echo with the anomalies in the derivatives market. Data shows that the SOL funding rate has turned negative across major exchanges, and the open interest ( OI ) has dramatically dropped from $12 billion to $9.14 billion, indicating clear signs of liquidity withdrawal. If the funding rates for BTC or ETH follow suit and turn negative, it could trigger a larger wave of short selling, further validating Wintermute's strategic foresight.

( Small Market Capitalization Token Becomes Short Positions Target: Retail Investors Need to Beware of High OI Traps ) Wintermute is systematically targeting high volatility small coins, with TRUMP, FARTCOIN(, and Pump.fun) becoming key targets. These tokens exhibit typical "high open interest/low market capitalization" risk characteristics: as of the time of writing, TRUMP's open interest reached $368 million, FARTCOIN surged to $687 million, while the plummeting PUMP still maintained $434 million in open interest. Such distorted data often signals retail investors rushing in, and Wintermute takes the opportunity to short the "liquidity trap." It is worth noting that XRP's open interest of $7.23 billion indicates an intense battle between bulls and bears, and the sharp fluctuations in open interest of small coins often serve as a signal for smart money to hunt retail investors.

( Derivation market sentiment divergence: Long positions belief faces test ) In stark contrast to Wintermute's aggressive short positions, most derivation traders still hold long positions. Coinalyze data shows that BTC(795.5 billion) and ETH(469.7 billion) open interest remains high, with positive funding rates across the four major exchanges, indicating that the market still expects an upward trend. However, the warning signals for SOL cannot be ignored—if the funding rates for mainstream tokens turn negative across the board, it will signify a systemic reversal in market sentiment. Traders need to closely monitor the inflection point of the BTC/ETH funding rates, which could become a key catalyst for whether Wintermute's 26 million dollar ETH short order can be realized.

Conclusion: Wintermute's defensive reallocation serves as a mirror, reflecting institutions' deep concerns about the future market. The 70% short position ratio, heavy positions targeting blue-chip coins, and precise ambushes on high OI small tokens form its triple defense against risk. Although the long positions in the derivatives market have not yet retreated, the negative funding rate for SOL and the sharp decline in open contracts have sounded the alarm for structural risks. Retail investors should be wary of liquidity traps in tokens with high open contracts like TRUMP and FARTCOIN, and closely monitor the funding rate trends for BTC/ETH. When top market makers and market sentiment show significant divergence, it often signals that a turning point is approaching; cautious defense may be the optimal strategy at this moment.