Things are heating up for the largest altcoin Ethereum (ETH). Less than a week left until the final step of proof-of-stake (PoS), known as Merge. Meanwhile, traders are seeing the ETH futures market surge significantly since the beginning of August. According to the data for futures, they are piling on ETH derivatives for a potential “sell the news” event. Here are the details…
Leading altcoin Ethereum surpasses BTC in futures
A record hit last month, according to a new report from Tom Rogers, head of research at ETC Group. According to the report, “For the first time since registrations began, Ethereum futures volume surpassed Bitcoin by $1.07 trillion during the month.” Bitcoin futures volume often exceeded its nearest competitor by a ratio of 2:1 to 5:1. In other words, the movement is in stark contrast to the data of the last three years. August surpassed $1 trillion in ETH futures trading volume for only the second time in history. For this reason, it seems that the interest in ETH increases as Merge gets closer. Rogers used the following statements:
More volume means more liquidity in one asset or the other. This is desirable from a trade point of view as there are many buyers and sellers. This indicates that Ethereum’s upside 16% bounce since August 29 will continue apace.
Bitcoin transaction count overshadowed by Ethereum
Further evidence of increased interest can be seen as unique Ethereum transactions rose 40.3 percent between August 31 and September 4. In addition, transaction number data stands out, showing that in many cases Bitcoin (BTC) has exceeded the number of transactions. Data provided by Bitinfocharts shows that on September 4, the total number of transactions in Ethereum was 459,451 compared to 421,019 in Bitcoin. Last week, the price of ETH rose 7 percent compared to a 4 percent increase for BTC. He emphasized that trading volumes tend to be correlated with price movements.
With that in mind, interest in Ethereum has outstripped Bitcoin since mid-June. The price of ETH has increased by 95 percent compared to a 20 percent increase for BTC over the same period. A similar trend was seen in the futures data. Data from Deribit revealed some interesting things about the interest in ETH futures. It shows that ETH interest has increased by 70% since mid-July, compared to a 12.9% increase in interest in Bitcoin futures.
What do the experts say?
David Lifchitz, managing partner and chief investment officer of ExoAlpha, also commented on the matter. He gave information about the future outlook of ETH price. He noted that ETH “could bounce around 90% from its summer lows.” He emphasized that “BTC, on the other hand, remains near its summer low.” Lifchitz pointed to Merge as the reason for ETH’s outstanding performance. But he said the network will still have to grapple with one of its biggest problems, high transaction costs. Therefore, he warned that the appearance after Merge is unknown. Lifchitz used the following statements:
There was a lot of hype for this event. However, with PoS, the cost of transactions on Ethereum Blockchains is not expected to drop much from the current PoW model, which can be quite problematic at times. So anyone can guess what the fees will be. ETH price will move after Merge.
Lifchitz also highlighted the possibility that Merge may not be successful. He believes that the Ethereum Blockchain will be unstable for a while. Overall, Lifchitz notes that recent gains for Ethereum are more likely due to the speculation surrounding Merge. He suggests that this does not show how Bitcoin and Ethereum will act on a macro scale. Merge is expected to take place this week, as we have also reported as Kriptokoin.com.
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