The Ethereum derivatives market has seen a significant rally, with open interest in futures reaching an all-time high of $20.8 billion on Friday, up 12%.
Ethereum (ETH), which gained 6.2% in a week, rose to $ 3,294. Blockchain analysis firm CryptoQuant said in a statement, “This rise is an indication of increasing participation in Ethereum derivatives markets.”
Open interest in the Ethereum derivatives market has reached unprecedented levels. According to CryptoQuant, the Ethereum Open Interest weighted futures funding rate, which measures leveraged positions, has also increased. The funding rate reaching 0.0374% indicates optimism in the market. CryptoQuant evaluated this situation as “short-term optimism for upward price movements.”
Ethereum’s derivatives market continues to grow robustly, with open interest increasing by more than 40% in the past four months. The market has surpassed the $20 billion mark for the first time, surpassing the previous record high of $17 billion set in May.
Positive funding rates suggest the market is leaning toward long positions. Additionally, Ethereum’s estimated leverage ratio (open interest relative to exchange reserves) has risen to a record high of 0.40, suggesting that investors are using leveraged positions to increase their returns by taking on more risk.
CryptoQuant warned that high leverage and long positions could lead to position squeezes in the event of sudden price swings. Ethereum’s on-chain trading volume also saw a notable increase in November. On-chain trading volume increased by 85% in just two weeks.
While the daily transaction volume reached $3.84 billion on November 1, this figure increased to $7.13 billion by mid-month, indicating a significant increase compared to the beginning of the year.
This rise in Ethereum parallels a general momentum in the crypto market. Bitcoin recently reached an all-time high of $99,000, helping to boost the prices of altcoins like Cardano, which rose 46% during the week, and Solana, which gained 22%.
It is thought that institutional investors have a significant share behind this movement in the crypto market.
