Why bitcoin is used as a benchmark
Bitcoin derivative markets often concentrate liquidity and broad crypto positioning. A portfolio manager can use a bitcoin short to reduce market beta without opening many smaller contracts.
That hedge leaves residual risk from token-specific events and changing correlations. The mismatch should be measured under several regimes.
Basis and funding are not uniform
Bitcoin and altcoin contracts can show different funding and futures basis because of borrow availability, collateral, arbitrage capacity, and participant demand. A spread can persist for structural reasons.
Normalize rates, fees, and settlement before calling a relative-value opportunity.
Product depth matters
Options, dated futures, and perpetuals may be available across several assets, but contract size, expirations, strikes, and executable depth can differ. Read the bitcoin versus altcoin derivatives comparison for a framework.