Bitcoin [BTC]Consistently dominant growth in the spot market (market cap) has outperformed all rivals by a margin. Ethereum [ETH]The nearest opponent still has miles and miles to go before he can capture the king coin.
However, what if we turn the battlefield into futures (markets) instead? Here’s how the table has turned when comparing BTC and ETH this year.
all in the name of merge
The upcoming Ethereum merge has created a lot of positive hype about the network and its future. The much-anticipated merger will reduce the issuance of ETH and bring a store of value appeal to the asset.
According to a new report by Tom Rogers, Head of Research at ETC Group, the futures markets have hit a $1 trillion market capitalization after the hype. In doing so, Ethereum futures overtook Bitcoin in terms of trading volume.
In fact, last month (August) was “the first time since record start that Ethereum futures trading volume surpassed Bitcoin, at $1.07T in the entire month,” the report said.
Plus, the latest insights from Glassnode Cast light on on this development. Here, the analysis reflected the difference in annual 3-month rolling basis between the two rivals.
(Three-month futures are the annual rolling basis annual yield (percentage return) obtained by buying a spot asset as well as selling a futures contract on it that expires in three months. Due to supply and demand factors, futures contracts often trade at a higher price than their spot counterpart.
It is used by traders to lock in profits which is the difference between spot and futures prices, which is currently played out entirely for the largest altcoins.
ETH surpassed BTC’s trading volume in the futures market and Attraction of spot hedge through short futures ETH in backwardness. This means that it exhibits a rising potential as traders increasingly bet on the same. (Backwardation occurs when futures prices fall below the expected spot price, and therefore increase to meet that higher spot price.)
Data shows open interest — or the number of unsettled futures contracts — rose to more than $9 billion this week, down from $4 billion in July. Moreover, ETH was dominated by bullish call options traders as the put/call ratio (PCR) was 0.25.
In fact, at press time, the rate was 0.24, which is again a bullish signal.
losing ground
Looking at BTC, the token remained in ‘contango’ and is “down” as the fundamentals suggested. Glassnode’s insight, Bitcoin supporters are getting wary about BTC as the ethereum rush celebrations began.
Bitcoin futures volume has fallen to $941 billion in August 2022, behind its nearest rival, Ethereum Futures.
In fact there is a sharp contrast compared to the last two to three years as bitcoin has always been a league ahead of ethereum.