Analysts underlined Ethereum: Pay attention to this data!

Analysts compare Ethereum's uncertainty regarding its future price with the volatility caused by options, comparing it to Bitcoin.

In contrast, Bitcoin's implied volatility has seen a more dramatic decline; This shows that derivative traders perceive that they are heading towards stability. Implied volatility (IV) is a measure used in the options market that represents the market's estimate of the likely future movement or price fluctuations of an asset or security.

According to The Block's data dashboard, Ethereum's IV has not fallen to the same extent as Bitcoin's during the current post-halving market adjustment period. The Bitcoin volatility index dropped from 72 percent during the halving event to 55 percent, the lowest level in the last few months. In contrast, the same measurement for #ETH showed a drop from 76 percent to the current value of 65 percent.

According to this week's Bitfinex Alpha report, options traders' uncertainty regarding Ethereum's medium-term price is reflected in the asset's volatility risk premium (VRP). The report summarized that the #ETH options market showed less in VRP than Bitcoin options.

Bitfinex analysts noted uncertain market conditions towards the end of the month for the second-largest digital asset by market capitalization due to the looming deadline for the U.S. Securities and Exchange Commission (SEC) decision on two spot Ether ETFs. “One possible reason why the #ETH volatility risk premium has fallen less than Bitcoin is because the SEC's ETF decision on May 23, 2024 creates additional uncertainty for the Ethereum price,” Bitfinex analysts added.

According to this week's Bitfinex Alpha report, options trader uncertainty about Ethereum's medium-term price is reflected in the asset's volatility risk premium (VRP). According to TradingView data, during the last market adjustment period after the halving, Bitcoin volatility risk premium (VRP) dropped to 8 percent, while #Ethereum's VRP dropped to 18 percent.
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