open interest - Pwim.Net

May 11: If You Can't Handle Me at My Worst, then You Don't Deserve Me at My Best…

Trading Crypto with Eugene is a series of daily commentary of market analysis and trading advice shared by Eugene Ng of Matrixport, a veteran trader with 10 years of experience in top-tier global investment banks. If you like the article, please follow us here on Blockchain.News so you won’t miss our future publications.

What a volatile Sunday for Bitcoin as it plunged from $9,800 to $8,100 in a single hour, a very large outsized move for a weekend trading session that even Coinbase suffered an outage. There was no news/catalyst, instead, I think it was a planned outsized sale that happened. A likely scenario is that coordinated selling or take-profit via OTC and exchanges. Despite $275 mln of BTC sell liquidations in the last 24 hours and around 10% of futures open interest declined across the board, open interest is still hovering $3bn and about 50% more than post-black Thursday’s crash in March. That says to me that there are just more longer-term investors sticking around. Predicting the price of Bitcoin post its halving isn’t going to be easy. If I have to make a guess, I would expect it to retrace some of its gains in the short-term. It depends on the momentum of Bitcoin’s price heading into halving. If the price continues to stay firm and head above 9,000, I would expect it to see a retracement albeit a less horrifying one compared to March 12. Even if BTC does continue to slide into $8k, I still think there is some likelihood of selling (i.e. miner captiluation) Why? Firstly, there have been quite a few funds, traders and market-makers who have positioned long, albeit less after yesterday. Secondly, miners selling into halving as the smaller players cant stay profitable.Trade strategy? I’ve been advocating to go Long Volatility in the last two weeks and that should play out quite well, I would start taking profit in 50% of them right now since implied volatility has now spiked higher. I also shared last Thursday to build put positions if BTC crosses 10k, that would have worked out quite nicely if you’ve bought some too. For spot, I am a buyer between $7,800 to $8,000, and if I own some BTC, seller between $9,300 to $9,500. Goodluck.

$9,300 level to watch today if we can breakthrough for us to continue the bullish momentum into halving, otherwise $7,900 may be tested… if that level breached, we may enter into another a lower range consolidation phrase…

If it does break $7,900, you can try buying at $7,200/$6,400/$5,400 to accumulate long term longs…

In the longer term, we are still in a healthy upward trending channel….

Implied volatility jumped on Sunday’s plunge! Time to sell some vol!

DisclaimerOpinions expressed are solely the analyst’s own and do not express the views of Matrixport the company.

The views and opinions expressed in this article are those of the contributor and do not necessarily reflect the view of Blockchain.News.

Open Interest for Ethereum Futures Soars to All-Time High of $2.21 Billion

Ethereum (ETH) is cementing its status as one of the leading cryptocurrencies after smashing the $700 price ceiling it last hit in May 2018. ETH has been making merry in 2020 after the much-anticipated Ethereum 2.0 went live and set the foundation for a transition to the proof-of-stake consensus mechanism from the current proof-of-work.

Bybt, an aggregated derivative exchange, has provided a more in-depth analysis about open interest on Ethereum Futures hitting record highs. The data provider affirmed:

“ETH Futures Open Interest breaks ATH $2.21 Billion.”

This record-breaking move is being witnessed at the same time when ETH’s price has zoomed off to levels not seen in 31 months. Santiment, an on-chain metrics provider, noted that this price rally has not been observed since May 19, 2018. Furthermore, ETH supply on exchanges has diminished to hit a 1.5-year low.

At the time of writing, ETH price is trading at $734, and one factor attributed to this bull run is the high number of Ethereum staked before ETH 2.0 was launched on Dec 01. Even though Ethereum 2.0 is already live, data from crypto market provider Dune Analytics shows that more than 1.4 million ETH has been locked up, and the number continues to grow by the day.

It is, therefore, not surprising that the open interest for ETH futures has reached an ATH of $2.21 billion because investors are continuously keeping a keen eye on the second cryptocurrency based on market capitalization.

Ethereum is expected to continue making headlines because it is touted to be a beneficiary of the trickle-down effects of Bitcoin’s impressive bullish run. The leading cryptocurrency has been the talk of the town after it continues to surge to levels never seen before. Over the Christmas weekend, it shuttered the $28,000 mark as huge institutional investments from corporate giants like Square and MicroStrategy have been fueling its price surge.

Ethereum Open Interest Hits All-Time High as 100% of ETH Addresses in Profit

It was a matter of when not if Ethereum (ETH) was going to hit its all-time high (ATH) price of $1,400 as previously predicted by analysts. ETH made a notable milestone of surging to $1,432 yesterday even though it has retraced to $1,350 at the time of writing, according to CoinMarketCap.

The current Ethereum bull run commensurates with the open interest of more than $4 billion its network is witnessing as acknowledged by unfolded. The market insight provider noted:

“Ethereum open interest hits all-time-high.”

Another on-chain data provider IntoTheBlock has also stipulated that the ETH market is overleveraged. Precisely:

“The market is overleveraged. The Ethereum perpetual swaps funding rate is currently above 0.22% across several exchanges and going as high as 0.5% on BitMex.”

Ethereum addresses are cashing in

With Ethereum’s daily transaction volume going parabolic and surpassing Bitcoin by $3 billion, it was a matter of time before ETH hodlers smiled all the way to the bank, as alluded by Rafael Schultze-Kraft. The on-chain analyst stated:

“100% of addresses holding ETH in profit – everybody happy.”

More participants have been joining the Ethereum bandwagon, and the recent price rally past the record-high of $1,400 cements this fact. Therefore, ETH is stamping its authority in the crypto space because its daily fees paid rose to $7.25 million compared to Bitcoin’s $3.12 million.

An investor at Variant Fund tweeting under the pseudonym Spencer Noon, explained:

“Ethereum continues to dwarf the entire crypto space in terms of fees paid ($7.25m daily avg) — proving it’s the most useful network in the world.”

The top two cryptocurrencies, Bitcoin and Ethereum, are involved in a neck and neck battle as they continue wooing more investors. Time will tell what they have in store going forward as record-breaking moves continue being the order of the day.

Crypto Interest in Asia is Brewing, Showing Long-Term Optimism in the Market

As the global crypto market capitalization inches closer to the $2 trillion mark, cryptocurrencies are no longer ignored in the financial sector as digital assets are rising in popularity.

The value of the crypto market currently stands at $1.76 trillion, according to CoinMarketCap.

Crypto analyst and investor Joseph Young has disclosed that Asia is showing considerable interest in the crypto market. He explained:

“The interest in crypto in Asia is just brewing. South Korea’s biggest search engine and internet conglomerate, Naver, invested in Hashed’s $120 million venture round in December 2020. Massively optimistic in the market long-term.”

The Asian continent continues to stamp its authority in the crypto space, as evidenced by the Bank of Japan governor’s remarks that the nation should prepare “thoroughly” for the issuance of its central bank digital currency (CBDC).

Bitcoin’s open interest across major exchanges recently hit a record high of close to $20 billion as more participants join its network. This trend made Pierre Rochard, a market analyst, point out that most people might be inclined towards holding Bitcoin compared to investing in stocks, bonds, or real estate in the future. If this sees the light of day, time will tell whether Asians will make the bulk of them.

Bitcoin’s last level of resistance stands between $58-59.3k before new highs

According to IntoTheBlock, Bitcoin has to surge past the last level of resistance between $58,879 and $59,241 before the skies clear for new highs. The crypto data firm acknowledged:

“Bitcoin smashes through the $55,000 resistance and heads back up to $58,000. The IOMAP indicator reveals that the last level of resistance is between $58,879 and $59,241, where 220k addresses previously bought 73.95k BTC. After that, clear skies towards new highs.”

Jan & Yann, the co-founders of leading on-chain data provider Glassnode, have also disclosed that the impact of long-term BTC holders who are taking profits is less evident now than during January’s peak.

As more participants continue joining the crypto bandwagon, Asia looks set not to miss out.

Ethereum’s Perpetual Swaps Open Interest Hit a Two-Month High

The latest surge in the crypto market has made Ethereum’s perpetual swaps open interest to increase, as disclosed by IntoTheBlock.

The data analytic firm explained:

“Ethereum’s Perpetual Swaps Open Interest just reached the highest number since May 19. As Open interest increases with the price of ETH, it points to more longs being opened. Currently, there are $6.16 billion in open positions.”

It, therefore, shows that Ethereum price is positively correlated with open interest.

Ethereum has been experiencing an uptick in different areas. For instance, its crowd sentiment on Twitter recently hit a two-month high after the second-largest cryptocurrency based on market capitalisation jumped above the $2,400 level.

Furthermore, ETH 2.0 validators topped 200.000. Ethereum 2.0 was launched in December 2020 and sought to transit the current proof-of-work (POW) consensus mechanism to a proof-of-stake (POS) framework.

ETH hourly fees skyrocketed to $2.53 million following the sale of Stoner Cats

Meanwhile, the Ethereum network has been in high demand in the non-fungible token (NFT) sector.

For instance, Stoner Cats, an adult animated short series sold in NFTs, clogged the Ethereum network leading to the loss of more than 344 ETH in gas fees. Moreover, hourly fees surged to $2.53 million.

IntoTheBlock acknowledged:

“With the highly anticipated launch of Stoner Cats, over 10k NFTs were sold with a total value of 3,650 ETH. But what’s impressive was the high demand on the Ethereum blockchain, which resulted in over 344 ETH wasted in gas fees. Ethereum Hourly Fees skyrocketed to $2.53 million.”

On July 27, a total of 10,420 Stoner Cats in the form of NFTs were put up for sale at 0.35 ETH each, and the entire supply was sold out in 35 minutes.

NFTs have been playing a pivotal role in the Ethereum ecosystem. Recently, Coca-Cola revealed the launch of the first-ever NFT collectables to honour International Friendship Day, to be held on July 30.

Ethereum’s Perpetual Swaps Open Interest Tops $8B for the First Time Since May

Ethereum’s open interest continues to be correlated with its price, as acknowledged by IntoTheBlock.

The data analytic firm explained:

“Ethereum’s perpetual swaps open interest crosses the $8 billion mark for the first time since May 18. Open Interest refers to the dollar amount of contracts outstanding. As the price of ETH has been climbing alongside OI is said to confirm an upward trend.”

Therefore, Ethereum’s price and open interest are strongly correlated based on these statistics.

ETH has been experiencing an uptick in price days after the London Hardfork or EIP 1559 upgrade went live, seeking to make the second-largest cryptocurrency deflationary.

This improvement will see a base fee set for every transaction carried out, giving all a fair opportunity on the ETH network.

Users who may wish to conduct their transactions faster than the standard provisions of the network will be able to add a tip to validators to fast-track their transactions. Part of this tip is burnt, helping to improve the monetary policy of the Ethereum network as a whole.

More than 18,000 ETH already burnt

According to crypto data provider, CoinMetrics:

“Over 18K ETH has already been burned since Ethereum’s London hard fork went live on August 5th, approx. ~32% of the total ETH issued post EIP-1559.”

Furthermore, Ethereum’s trading volume surged past $10 billion from top-tier exchanges in the last 24 hours.

Ethereum (ETH) has experienced a significant adoption rate thanks to booming non-fungible token (NFT) and decentralised finance (DeFi) sectors.

As a result, ETH’s trading volume across different platforms has been on an upward trajectory. For instance, it accounted for nearly half of the trading volume on top exchanges.

Meanwhile, Bloomberg analyst Mike McGlone recently stated that nothing could stop the process of Ethereum flipping Bitcoin.

Ethereum Whales’ Accumulation Mode Continues as Price Tops $3,200

Days after the London Hardfork went live, Ethereum (ETH) has been experiencing an uptick in prices as the second-largest cryptocurrency is set to become deflationary based on this upgrade.

ETH was up by 16.52% in the last seven days to hit $3,228 during intraday trading, according to CoinMarketCap.

Ethereum whales are not relenting in their accumulation quest because addresses with more than 100k coins now hold 43.7% of ETH supply, as acknowledged by Santiment. The on-chain metrics provider explained:

“Ethereum whale addresses aren’t stopping their accumulation as prices hover above $3,100. Three years ago to the day, addresses with 100k+ ETH owned 35.8%. Today, they own 7.9% more of the second market cap asset’s total supply. There are 1,338 of such addresses.”

These statistics show that Ethereum whales’ accumulation has been on an upward trajectory because they owned 35.8% of ETH supply three years ago compared to the current 43.7%.

Is Ethereum eyeing the $4,000 level?

According to market analyst Ali Martinez:

“The IOMAP shows that Ethereum could run to $4,000 if ETH manages to close above $3,235. A rejection from this supply barrier could lead to a spike in selling pressure that pushes ETH to $2,700.”

Martinez believes that a run to the $4,000 level is relatively open because Ethereum currently stands at the zone, which it has to break for more upward momentum to be attained.

On the other hand, Ethereum options open interest recently surged to a two-month high.

ETH was recently boosted after the London Hardfork or EIP 1559 was implemented because a base fee for every transaction carried out will be set. As a result, giving all a fair opportunity.

Furthermore, users who may wish to conduct their transactions faster than the standard provisions of the network can add a tip to validators to fast-track their transactions. Part of this tip is burnt, helping to improve the monetary policy of the Ethereum network as a whole and making it deflationary.

With ETH options open interest topping $4 billion, whether this will boost Ethereum’s journey to the $4,000 level remains evident.

Crypto Open Interest and Trade Volume Reach Levels since March

Open interest and trade volume in the crypto market has increased based on the latest surge in prices, confirmed by Bybt.

The crypto analytic firm explained:

“The total open interest and total trading volume of crypto futures reached the level of March, indicating that the market is further active.”

Bybt believes that the crypto market reflects activeness given that trading volume and open interest were on an upward trend. Open interest entails the dollar amount of contracts outstanding.

Recently, Ethereum’s perpetual swaps of open interest crossed the $8 billion mark for the first time since May. It, therefore, showed that Ethereum’s price and open interest were strongly correlated.

ETH’s upward momentum was boosted after the London Hardfork, or EIP 1559 upgrade, went live on August 5.

This improvement seeks to make the second-largest cryptocurrency deflationary, given that scarcity was introduced every time Ether was burnt after being used in transactions. Therefore, helping to eliminate inflationary tendencies that the network was accustomed to before.

The burning of Ether has been reached an all-time high, given that a new burn record of 1,638 ETH in one hour was recently hit.

The value of the crypto market hit $2 trillion

According to journalist Colin Wu:

“The total market value of the cryptocurrency market has returned to 2 trillion U.S. dollars, currently about $2.11trillion, which is less than 20% from the peak of about $2.61trillion set on May 12th.”

After enduring months of consolidation, the crypto market experienced an uptick in price as low volatility had become the norm. This was partly caused by crypto mining being unwelcome on Chinese soil as miners exited the nation.

Meanwhile, 76.8% of Bitcoin’s supply was held by strong hands or investors who hold BTC for long-term purposes other than speculation.

Long-term holders have emerged to be significant players in the Bitcoin ecosystem. For instance, they set the accumulation ball rolling by purchasing more BTC, evidenced by their heavy buying during the recent dip of $29.5K.

Bitcoin Perpetual Swaps Open Interest Hits the Highest Point Since Mid-April by Topping the $16B Mark

Bitcoin (BTC) has been experiencing an uptick in activities with perpetual swaps of open interest recording a 5-month high.

Data analytic firm IntoTheBlock explained:

“Bitcoin Perpetual Swaps Open Interest just broke the $16 billion mark, the highest since mid-April. An increase in open interest alongside price is considered a bullish signal.”

The leading cryptocurrency recently saw more than 1 million addresses transact, which hadn’t been seen in 2 months.

BTC exchange withdrawals surge to a monthly high

According to crypto analytic firm Glassnode, the number of Bitcoin exchange withdrawals reached a one-month high of 1,816.030.

This trend is usually considered bullish because coins are usually transferred to cold storage and digital wallets, which signifies a holding culture.

Glassnode added:

“The dominant majority (98%) of Bitcoin volume spent on-chain are coins that were moved within the last month. Historically, such low old coin volume has correlated with generational tops, bottoms and early bull markets (disbelief rallies).”

Miner revenue hit a 3-month high

Bitcoin miners’ revenue rose to a 3-month high of $5.9 million amid hashrate reaching a monthly high.

This is a sigh of relief to BTC miners because they found themselves on the receiving end after Chinese authorities intensified the crypto mining crackdown in May.

For instance, Bitcoin mining sites in Sichuan were disconnected in June, which hampered more than 90% of China’s crypto mining capacity. As a result, the hashrate was nosedived by 50% in July. The upward trajectory in Bitcoin’s hashrate and miner revenue was prompted by a shift from the East to the West, with the United States being the largest beneficiary.

The hashrate is used to measure the processing power of the BTC network. It allows computers to process and solve problems that enable transactions to be approved and confirmed across the network.

Ethereum Futures Open Interest Hit an ATH Amid $1B Being Locked in ETH Layer Two

Open interest in the Ethereum (ETH) network has been experiencing an uptick, as disclosed by market analyst Lark Davis.

He explained:

“Open interest for Ethereum futures has just hit a new all-time high! The market is mega bullish right now and going long in a serious way.”

ETH’s perpetual swaps open interest topped $8 billion in August as the second-largest cryptocurrency witnessed more transactions days after the London Hardfork or EIP 1559 upgrade went live.

This improvement made Ethereum deflationary, given that scarcity was introduced every time Ether was burnt after being used in transactions. As a result, inflationary tendencies were eliminated because a base fee was set for every transaction.

Total value locked in Ethereum layer two surges to $1 billion

According to L2BEAT, an analytic and research platform, Ethereum layer 2 (L2) is booming because $1 billion has been invested in scaling protocols.

Ethereum L2 is a scaling solution created to mitigate congestion on the network. As a result, decentralized applications (dapps) can avoid network congestion by utilizing various technologies.

The Ethereum 2.0 deposit contract, which went live in December 2020, is expected to boost scalability by offering a transition to a proof of stake (POS) consensus mechanism from the current proof of work (POW) framework.

Meanwhile, decentralized finance (DeFi) has become a billion-dollar industry valued at more than $80 billion. This sector took the world by storm in 2020 after it witnessed a 14x growth.

DeFi is founded on blockchain-based smart contracts that fulfil certain financial functions based on the underlying code.

The United States took the lion share in DeFi adoption, followed by Vietnam, Thailand, China, and the United Kingdom, according to a recent report from blockchain analytic firm Chainalysis.