Bitcoin [BTC]The ever-dominant rise of s in the spot market (market capitalization) has left all competitors far behind. ether [ETH]the nearest rival still has miles and miles ahead of them before they can catch up with the king coin.
However, what would happen if we shifted the battlefield to the futures (market) instead? This is how the tables have turned this year when comparing BTC and ETH.
All in the name of Merge
The upcoming Ethereum merge has created positive hype about the network and its future. The much-anticipated merger would result in a reduction in ETH issuance, giving the asset an attractive store of value.
Futures markets have hit a $1 trillion market cap in the wake of the hype, according to a new report by Tom Rogers, head of research at ETC Group. Ethereum futures outperformed Bitcoin in terms of trading volume.
In fact, last month (August) marked the “first time on record that Ethereum futures trading volume surpassed Bitcoin at T$1.07 during the month,” the report added.
Additionally, the latest finding from Glassnode sheds light on the same development. Here, the analysis showed the sheer difference in the 3-month annualized moving basis between the two contenders.
(The annualized rolling basis for three month futures is the annualized return (per cent return) realized by buying a cash asset and simultaneously 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.
This is used by traders to lock in the profits resulting from the difference between spot and futures prices, which currently works out perfectly for the largest altcoin.
Source: Glassnode
ETH surpassed BTC’s trading volume on the futures market and the Attractiveness driven by spot hedges over short futures ETH into backwardation. This means that it had potential to rise as traders placed bullish bets on it. (Backwardation occurs when futures prices are below the expected spot price and therefore rise to meet that higher spot price.)
Open interest — or the number of unsettled futures contracts — surged to over $9 billion this week from under $4 billion in July, data shows. Also, ETH was dominated by bullish call option traders as the put/call ratio (PCR) stood at 0.25.
In fact, as of press time, the price is trading at 0.24, which is again a bullish sign.
lose ground
Looking at BTC, the token has remained in “contango” and fundamentals suggest the “bottom is in,” Glassnode found. As the Ethereum crowd celebrations began, Bitcoin supporters grew suspicious of BTC.
Bitcoin futures volume is down to $941 billion in August 2022, behind its closest competitor, Ethereum futures.
Source: ITB
In fact, a sharp contrast to the past two to three years, as Bitcoin has always been the one that was miles ahead of Ethereum.
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