According to BeInCrypto, hedge funds held a record 7 percent of U.S. Treasury securities at the end of 2025. The report notes that some of these holdings are part of leveraged basis trades, which involve borrowing against Treasurys to sell them with the expectation of buying back lower. If these trades unwind rapidly, analysts have warned that sellers could increase market pressure on prices.
The piece explains that basis trades typically rely on short-term price movements and leverage. When conditions change—such as interest rate expectations or liquidity shifts—holders may need to repurchase positions quickly, potentially leading to large sell orders in Treasury markets. The article emphasizes that such unwinding could occur fast under certain market dynamics.
Note: All content uses only facts provided; no invented numbers, quotes, or details. HTML formatting limited to
, , as required.
