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Ethereum Price Holds Above $3,300 as Derivatives Traders Bet on Gains
Ethereum has maintained its price above $3,300, as the cryptocurrency market prepares for significant events. Derivatives traders have shown a bullish outlook on Ethereum, with open interest in Ether’s derivatives contracts exceeding $30 billion.
Ethereum Sees Big Bets from Derivatives Traders
Derivatives data indicates a nearly 47% increase in options trade volume over the past 24 hours, with options volume crossing $1 billion within a 24-hour timeframe. The long/short ratio, used to determine whether derivatives traders are bullish or bearish on a token, is greater than one on major exchanges. This suggests that derivatives traders are optimistic about an increase in Ethereum’s price.
Ethereum On-Chain Analysis
The outlook of derivatives traders is often seen as a measure of what traders can expect in spot markets. When combined with bullish on-chain metrics, derivatives traders’ outlook supports a thesis of gains in Ethereum’s price. Data shows that the Ether token supply held by large wallet investors has climbed steadily, even as the ETH price suffered a decline. This is a positive sign for Ethereum.
The total funding rate aggregated by Ethereum is mostly positive throughout January 2025, representing optimism and hope for price gain among traders. Additionally, the supply of Ether held by traders with 1,000 to 10,000 ETH in their wallets increased in the past week, while holders with 1 million to 10 million Ether added to their ETH holdings between the last two weeks of 2024 and January 17, 2025.
Ethereum Market Movers
Institutional capital inflow to Ether nearly doubled on Thursday, with ETH Spot ETFs recording $166.6 million in inflows on January 16. Typically, rising institutional interest is bullish for Ether. Another key market mover is the rising activity on the chain from Layer 2 protocols, with Ethereum Layer 2 chains experiencing rapid growth in active addresses.
Some key market movers to watch include:
- Institutional capital inflow to Ether
- Rising activity on the chain from Layer 2 protocols
- Increasing adoption and utility of Ethereum Layer 2 chains
Technical Analysis and ETH Price Forecast
The ETH/USDT weekly price chart shows Ether hovering around the $3,360 level. Two technical indicators, the Relative Strength Index (RSI) and the Moving Average Convergence Divergence (MACD), support a bullish thesis for Ethereum. If Ethereum ends its consolidation and breaks above the December 2024 peak, the altcoin could target the $4,578 level and rally towards its previous all-time high at $4,878.
Vitalik Buterin’s Take on Ethereum Layer 2 and the Future of Ether
Vitalik Buterin recently commented on the benefits of Ethereum Layer 2, stating that it is “great for businesses and users.” Buterin believes that the creation of a free market on the Layer 2 level makes it more accessible and useful for businesses and users, supporting the growth of the Ethereum ecosystem.
“The @Soneium situation is a good live demonstration of how launching an ethereum L2 is great for businesses *and* users. Businesses can make very fine-grained choices around how much control they keep vs give to users.”
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