What is basis?

Basis is the difference between a futures contract's price and the underlying spot price. When futures trade above spot, the basis is positive; when they trade below, it is negative.

What a positive basis means

A rich, positive basis means traders are paying a premium to hold leveraged long exposure. It signals bullish demand, but a very high basis also means crowded, expensive positioning.

When basis flips negative

A negative basis, where futures trade below spot, points to bearish pressure or aggressive hedging. It is less common and often marks fear or forced selling.

Convergence

For dated futures, the basis narrows toward zero as expiry approaches, since the contract must settle at the spot price. For perpetuals, funding plays the same tethering role.

How to read it here

We track the basis per instrument so you can see when the premium is stretched. Read it as a measure of leverage and demand, not as a buy or sell instruction.