There’s a popular opinion in cryptoland that the launch of bitcoin futures by the CME in December will trigger an investing rush as institutional investors and hedge funds wade into the market in size. This in turn, the theory goes, will see the price zoom even higher.But here’s the thing. Smart money almost never takes unhedged directional bets.To the contrary, it seeks out risk-free arbitrage opportunities that usually involve spread or basis-based trades that take advantage of market pricing anomalies.Back in 2008, one of the biggest arbitrage opportunities of this sort came in the shape of the disconnect between US TIPs securities and conventional Treasuries, which emerged due to Lehman’s preference for using TIPs as collateral in repo trades. As the investment bank’s liquidity
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There’s a popular opinion in cryptoland that the launch of bitcoin futures by the CME in...