As you guys may know, Bitmex introduced the ETHUSD quanto swap in August which lets you short ETHUSD posting XBT as margin.
From the guide posted here https://www.bitmex.com/app/seriesGuide/ETHUSD, it says that the only way your PnL is affected is by change in in the price of ETHUSD . Example for reference:
Bitcoin PNL = (ETHUSD Exit Price – ETHUSD Entry Price) * Bitcoin Multiplier * # Contracts
Notice that the only variable that affects the PNL is the movement of the ETHUSD price. Neither the .BXBT, nor the .ETHXBT exchange rate affect either trader’s PNL.
To preface, when you 1x short XBTUSD with full equity, your exposure to XBT is 0, in essence you are in synthetic USD if you don't take funding into account.
For the ETHUSD perp swap, since the PnL and margin is XBT, and neither the .BXBT nor the .ETHXBT exchange rate is taken into account, being 1x short ETHUSD on Bitmex exposes you to the vagaries in price of the aforementioned indexes.
So as shown in the example above, if I was short at $500 on ETHUSD and price went to $495, I would make 0.5 XBT profit regardless of if XBT price has declined in that time period. During the time of my short, if BTC dropped for $10,000 to $5000 since my PnL is in XBT, I lose a lot of money i.e. I have exposure to XBT at all times when I am short ETHUSD unlike going 1x short on XBTUSD on Bitmex.
The question is, is there a way to be short the ETHUSD quanto swap without having any exposure to any cryptocurrency i.e. being in synthetic USD?
Thanks for the help!
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