Bitcoin [BTC]The ever-dominating rise in the spot market (market value) has left all competitors far behind. Ethereum [ETH]the nearest competitor still has miles and miles to go before he can catch up with the King’s Coin.
However, what would happen if we changed the battlefield to futures (the market) instead? Here’s how the tables turned this year when comparing BTC and ETH.
All in the name of merging
The upcoming Ethereum Merge created positive buzz about the network and the future it holds. The long-awaited consolidation will lead to a drop in ETH issuance and bring a store of value to the asset.
Futures markets hit $1 trillion in market capitalization after new hype, according to A Report From Tom Rogers, Head of Research, ETC Group. While doing so, Ethereum Futures surpassed Bitcoin in terms of trading volume.
In fact, last month (August) was “the first time since records began that Ethereum futures trading volume exceeded Bitcoin, at $1.07 T over the course of the month,” the report added.
Moreover, Glassnode’s latest ideas Highlight on the same development. Here, the analysis described the dramatic difference in the 3-month annual turnover basis between the two competitors.
(The annual turnover basis for a three-month futures contract is the annual yield (return percentage) obtained by simultaneously buying a spot asset and selling a future contract that expires in three months. Due to supply and demand factors, futures contracts are often traded at a price higher than the immediate corresponding part.
This is used by traders to take profits that are the difference between spot and futures prices, which currently works perfectly for the largest altcoin.
ETH exceeds BTC trading volume in the futures market and Pushing the allure of spot hedging via short futures contracts ETH backwards. This means that it showed upside potential as traders placed bullish bets on the same. (A pullback occurs when futures prices are lower than the expected spot price, and therefore rise to meet that higher spot price.)
Open interest – or the number of unsettled futures contracts – rose to more than $9 billion this week from less than $4 billion in July, Show data. Also, bulls traders dominated ETH with the buy/sell ratio (PCR) at 0.25.
In fact, the price stopped at 0.24, which is a bullish signal again.
Loss of reasons
Looking at BTC, the token remains in “contango” and the fundamentals indicate “bottom is in” according to Glassnode’s insight. As the Ethereum crowd celebrates, Bitcoin supporters are worried about BTC.
The volume of Bitcoin futures rose to $941 billion in August 2022, behind its closest competitor, Ethereum Futures.
In fact, there is a sharp contrast compared to the past two to three years since Bitcoin has always outperformed Ethereum.