CME’s annualized bitcoin basis has fallen to -2.35%, its deepest pullback since the extreme dislocations of the FTX crash in November 2022, when the basis briefly approached -50%, according to Velo data.
Backtracking describes a futures curve in which contracts that expire earlier trade at a higher price than contracts that expire later. In other words, the market is setting the price of bitcoin in the future at a lower level than the current or short-term price. This creates a downward-sloping futures curve and indicates that traders expect weaker prices as time goes on.
This structure is often unusual in bitcoin because bitcoin futures almost always trade at a premium, known as contango, which reflects the cost of leverage and the strong demand for futures exposure.
The recent move towards backwardation first appeared around November 19, just two days before bitcoin bottomed around $80,000 on November 21. This recent correction has seen a considerable amount of leverage removed from the system, with traders unwinding long futures and institutions reducing exposure.
Hindsight has historically appeared in times of stress or forced de-risking, and previous episodes of November 2022, March 2023, August 2023, and now November 2025 closely aligned with major or local market lows.
However, forwardation does not automatically imply a bullish inflection. As highlighted in previous CoinDesk research, bitcoin is not comparable to physical commodities like oil, where the pullback reflects tight supply. CME futures are cash-settled, widely used by foundation trading institutions, and can sink deeper into negative territory.
From this point of view, forwardation represents cautious future prices and weaker expectations rather than strength in short-term spot demand.
Much of the 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 run dry. Bitcoin is therefore entering an area where both dangers and opportunities have historically emerged.
