Ethereum (ETH) has hit a new all-time high, breaking the $ 1,500 mark for the first time. But that seems to be just the beginning. Some indicators suggest that there is still significant room for improvement. The market update.
The time will come on February 8th, and the world’s largest futures exchange, the Chicago Mercantile Exchange (CME), will introduce Ethereum Futures. The contracts bring back memories of 2017 when the Bitcoin futures launch coincided with a high in the leading digital asset, and the price subsequently plummeted. At that time, many blamed the CME for the spectacular price crash of Bitcoin (BTC), and some were wondering whether the same could happen with Ether.
Nikolaos Panigirtzoglou, an investment strategist at JPMorgan Chase & Co. believes it is possible that the Ether futures could cause negative price dynamics. That would be because large investors could bet on falling ETH prices through the introduction of the Ether Futures. Nevertheless, Ether is currently unimpressed. The smart contract platform climbed to an all-time high of $ 1,565 as of press time, up 11.15 percent in the past 24 hours.
The Ethereum course has now performed better than Bitcoin (BTC) in both 2020 and 2021.
In addition, there are currently many indications that Ethereum will not suffer the same fate on February 8 as Bitcoin in 2017.
The Futures Premium measures how expensive longer-term futures contracts are compared to the Ether price on the traditional spot markets. Therefore, the indicator can be seen, among other things, as a reflection of the optimism of investors. The futures contracts are currently slightly above the prices of the spot markets, which indicates that investors are extremely optimistic about further price gains at ETH.
An annualized premium of 10 to 20 percent is healthy for the markets, and any number above that indicates great optimism. Conversely, the lack of such a premium is a sign that investors may be bearish.
The graphic above shows that the premium was drastically reduced on January 21st. This has to do with the 20 percent drop in the ETH price at the time. Only recently, however, on January 27, the premium hit an annualized rate of 8.7 percent.
These data suggest that the futures markets are still bullish. Despite the sometimes drastic sell-offs in recent weeks, investors on the futures markets continue to take a positive stance. In addition, the current value of 2.9 percent corresponds to a healthy annualized premium of 20 percent. This indicates that the bulls do not expect any major price setbacks at ETH in the near future and that there is still clear room for improvement.
Additionally, the staking rate has increased 250 percent since December. This means that around 2.8 million US dollars are currently in the ETH 2.0 staking contract.
As a result, more and more ETH are disappearing from the market because investors are paying their ethers into the staking contract to earn staking rewards. It is still unclear when these ETH will come back on the market, as they can only be withdrawn from the staking contract at the end of the full implementation of ETH 2.0. According to estimates, this could take another year or two .
The staking rate of the last few weeks shows how optimistic investors are about the future of Ethereum. More and more people are taking the risk and tying their ETH in staking contracts for an indefinite period. As a result, the Ethereum supply is further reduced, which can lead to the fact that if the demand remains the same or increases, the Ethereum price increases.
In addition, the Grayscale Ethereum Trust (ETHE) has grown by $ 38 million in ethers since it reopened.
These data make it clear that institutional investors are not only interested in Bitcoin, but that Ethereum is also increasingly moving into the focus of large investors.
P.S. You Can Support me For Free Through ALL of these Links and earn some Crypto/Money Yourself! https://allmylinks.com/zealdorn
Disclaimer: These lines are not a substitute for investment advice, investments in the crypto market are made at your own risk. Invest only as much as you are willing to lose. I get commissions for purchases made through links in this post.