A recent study showed that investors’ views on Ethereum (ETH) and Bitcoin (BTC) are very different from one another.
Bybit, the second-largest cryptocurrency exchange in the world by trading volume, and BlockScholes have worked together to share the latest Crypto Derivatives Analytics Report.
The study shows that people are becoming more optimistic about ETH. This can be seen in market trends and trading signals for spot trading, futures, options, and perpetual contracts.
Investors are getting more and more excited about Ethereum because the first Ether Spot ETFs are about to start trading in the US. This optimism is shown by the fact that Ethereum has a higher volatility premium than BTC, even though the market has been active and prices have been falling recently.
ETH Market Sentiment Surges
Even though the market is down, open interest in ETH futures has recovered faster than in BTC. This trend shows that the market has a strong story about ETH and its future. Also, more trades in Ethereum perpetual contracts show substantial long positions, most likely because people are planning ahead for how the market will change in the future.
There were a lot more trades for perpetual swaps during the recent crypto sell-off because many traders closed their long holdings.
“The higher trade volume in Ethereum suggests that traders were caught in bigger long positions, possibly because they were positioning ahead of when they thought the ETF would start trading,” the report said.
In addition, the instability of the ETH options market is still high, especially as people wait for ETF approval. This is different from the more defensive stance seen in BTC options.
The study also says that the volatility of ETH options is 10–15 points higher than that of BTC options at all term lengths. Ethereum has also regained its volatility smile skew toward out-of-the-money (OTM) calls faster than BTC.There has also been a lot of trading in Ethereum calls, which is a lot more than trading in puts.
Eugene Cheung, Head of Institutions at Bybit, said, “The latest data shows that Ethereum is strong and appealing to the market as we approach important regulatory milestones.” Investors are clearly putting themselves in an advantageous situation as market expectations rise.
