Chief Economist of a Major Chinese Company: “In Bitcoin, Institutional Investors Have Become the Landlords, While Retail Investors Have Become the Tenants”

Fu Peng, the new chief economist at Xinhuo Group, known for its assessments of cryptocurrency markets, shared a remarkable analysis of Bitcoin’s fundamental dynamics.

In statements made via the X platform, Fu stated that Bitcoin’s evolving structure, particularly through futures and ETFs, is increasingly resembling some models in traditional financial markets.

According to Fu Peng, the logic behind Bitcoin perpetual contracts and ETFs largely overlaps with the “carrying cost” or “overnight fee” mechanisms seen in gold and industrial commodity markets. This structure points to a model where large investors generate income through long positions while creating a stable cash flow in the market. In this context, funding fees paid by individual investors for leveraged transactions stand out as the system’s primary source of revenue.

According to the analysis, large-scale spot investors are not simply classic “long” players who take positions solely on the expectation of price increases. Instead, these investors act almost like “householders,” protecting their long-term positions and accumulating funding income through hedging strategies. In this way, large whales reduce their position costs over time, and under certain conditions, can even reach “zero cost” or “negative cost” levels.

Fu Peng argues that the common perception in the market that “large investors are shorting” is not true. According to the economist, the real role of these whales is to be “rent collectors” who regularly earn income from the market. Indeed, the premium and discount structure in CME Bitcoin futures is said to be a reflection of these cost and return dynamics.

*This is not investment advice.