Is Basis Risk Generally Higher or Lower for a Cryptocurrency Futures Contract Compared to a Traditional Commodity Future?

Basis risk is often considered higher for cryptocurrency futures. This is due to the higher volatility of crypto assets, the fragmentation of the spot market across many exchanges, and the varying methodologies used to calculate the crypto index price for settlement.

Traditional commodities have more standardized spot markets and often have a physical delivery mechanism that forces convergence more strictly, leading to a generally more predictable basis.