The Glassnode report shows that Bitcoin and Ethereum derivatives are gaining massive traction
The crypto winter of 2022 looks set to be one of the most severe bearish trends in cryptocurrency history. This led to the entire crypto market being reduced by over 50% in value since the beginning of the year. The situation in the crypto market also worsened with the collapse of the Terra-LUNA ecosystem.
However, the crypto market is recovering a little from the trauma of the first half of the year. Bitcoin price suddenly picks up despite week’s volatility and swings.
According to the data from Glassnode, a blockchain analytics firm, the derivatives of the leading cryptocurrencies are making positive progress. Bitcoin and Ethereum derivatives are getting increased attention from investors with more BTC futures trading and higher ETH holdings.
The record from Glassnode indicates that the Bitcoin derivatives market has a slight directional bias. This means that investments in the market come with more caution from investors. But on the Ethereum side, there is evidence of optimism from investors.
The network registers several demands for ETH against a small withdrawal from the wallet. These major events for Ethereum may be due to the upcoming merger.
According to Glassnode’s Future Open Interest (BTC) Metric, investors seem to have more confidence in the derivatives market. They put aside the events and fears that accompanied the collapse of the Terra-LUNA tokens. The effect of the mining capitulation in May-June is also gradually diminishing.
Glassnode noted the increasing stability in trading volume for futures. It recalled that the last 12 months from the sale since May 2021 represented a structural fall in trading volume. However, it seems to be making a comeback as it boasts $33 per day.
The futures markets have also undergone a structural change during the past year and a half. This was at the beginning of 2021, when the Bitcoin price was in a bullish trend. The underlying spread was stable even though leverage increased.
Increase in open interest in Ethereum than Bitcoin
Currently, Ethereum derivatives are getting more attention from investors than Bitcoin. This appears to be the first time in cryptocurrency history to experience such a twist between the two leading assets. While Ethereum derivatives register around $6.6 billion in ETH, those of Bitcoin are at $4.8 billion in BTC.
In addition, the playout shows that ETH Options Open Interest is almost at ATH in November 2021. This was when Ether reached $4,900.
A more acceptable explanation for the price increase is the influence of the upcoming Ethereum merger. Most investors are bullish on prices between $2,200 and $5,000.
Featured image from BBC, chart from TradingView.com
