The price of Ether (ETH) surged to $4,000 on March 23, briefly exceeding $3,890 before dropping due to $46.58 million in leveraged long liquidations. Following this rally, the open interest in Ethereum futures hit a record high of $17.09 billion on May 28.
Similarly, with the ongoing consolidation above $3,700, the open interest in Ethereum futures remains strong at $16.1 billion, as reported by Coinglass data.
Additionally, the monthly trading volumes of Chicago Mercantile Exchange (CME) options on Ether futures reached an all-time high in May, according to a report by CCData on June 5. ETH options trading volume on the CME rose by 115% to $931 million, setting a new record high compared to April’s volume of $615.75 million.
Analysts suggest that the growing trading activity in Ether’s derivatives market reflects increasing institutional interest in ETH following the approval of spot Ethereum ETFs on May 23. Wintermute, an algorithmic trading company, noted that Ether’s CME open interest is nearing all-time highs, indicating institutional interest in the ETH/BTC trade ahead of S-1 filings and a potential launch.
Furthermore, the rise in Ether’s options implies an increase in volatility due to expectations of significant price movements, as highlighted in a report by the trading firm on May 27. Market participants anticipate Ether’s price to become more volatile as the launch of spot Ethereum ETFs approaches.
Perpetual contracts, also known as inverse swaps, show a similar bullish sentiment with increasing funding rates. Coinglass data reveals that ETH funding rates have surged in recent days to 0.0175, equivalent to 0.367% per week. In optimistic market conditions, the funding rate typically remains positive, indicating a bullish stance among traders using perpetual contracts.
At the time of reporting, the price of Ethereum was at $3,843, reflecting a 1.2% increase over the last 24 hours, based on data from CoinGecko.
It is important to note that this article does not offer investment advice or recommendations. All investment and trading decisions carry risks, and readers are encouraged to conduct their own research before making any decisions.