Ethereum (ETH), the biggest altcoin on Monday rallied from the $3,810 price mark to the $3,940 price level during the Asian trading time. It is expected the current surge came in likely due to Donald Trump’s pro crypto comments over the weekend.
Ethereum is on the surge
The price jump is recorded post a shift by the US Securities and Exchange Commission (SEC) towards allowing crypto linked exchange-traded funds (ETFs). This move has helped Ether to surge by 26% over the last week.
However, today’s price action shows that the market participants are expressing their bullishness in Ethereum rather than BTC. This can be true with the potential institutional demand once the ETH spot ETF starts trading in the market.
While the experts are structurally positive, a major breakout is not visible until more clarity is received on the S-1 approvals and some inflow data. It should only be a matter of time before the Ether ETF opens for trade. Until then, ETH frontend vols could remain above BTC and ETH skew is likely to remain in favor of Calls.
The enthusiasm for Ether ETFs mirrors the excitement seen with the launch of US spot-Bitcoin ETFs in January, which have amassed $59 billion in assets. However, Ether’s lower profile compared to Bitcoin makes investor demand harder to predict.
Ethereum is up by another 2.5% in the last 24 hours. It has surged by more than 71% on a year to date (YTD) basis. ETH is trading at an average price of $3,904, at the press time. It is just shy of breaching $4k at the moment. Its 24 hour trading volume is up by 64% to stand at $17.8 billion.
Wassup with options?
Options markets reflect a bullish outlook, with significant bets placed on Ether reaching $5,000 or higher. Ether’s record high is $4,866, achieved in November 2021. These optimistic bets also come with expectations of increased volatility.
The T3 Ether Volatility Index, which measures expected 30-day price swings based on options prices, indicates speculators anticipate larger movements in Ether compared to Bitcoin.
Open interest in CME Ether futures contracts indicating future buying or selling commitments—provides insights into institutional demand for regulated crypto exposure. Although interest in CME Ether futures is growing, it remains significantly lower than for CME Bitcoin futures. This suggests less institutional engagement with Ether and potentially the forthcoming Ether ETFs.
