The Graph (grt) 
Derivatives Market Report Shows Mixed Signals for Ethereum and Bitcoin
A recent derivatives market report released by Bybit and analytics firm Block Scholes highlights mixed signals for Ethereum and Bitcoin.
Ethereum’s Perpetual Open Interest Declines
The report notes a decline in Ethereum’s perpetual open interest, primarily due to the liquidation of overleveraged long positions. These positions had accumulated during a period of optimism but were reset by falling ETH spot prices.
However, ETH futures contracts have not experienced the same decline in open interest as ETH perpetual swap contracts during a brief pause in upward price momentum. Here are some key points to consider:
- Positioning has increased for both Bitcoin and Ethereum.
- The overall size of open positions has not yet recovered from the expiration of approximately $20 million in contracts at the end of November 2024.
- Traders who held November-expiring contracts have not returned to the market with the same volume.
Bitcoin’s Perpetual Positions Remain Stable
Despite a recent pullback from a high of over $100,000, Bitcoin’s perpetual positions have remained stable. This stability is in contrast to Ethereum’s decline in perpetual open interest.
Perpetual swaps are a type of derivatives contract that enables traders to speculate on an asset’s price without owning it. They are widely used in crypto markets, but unfavorable price movements can force leveraged traders into liquidation, reducing market activity.
Ethereum Outperforms Bitcoin in Options Open Interest
The report reveals that Ethereum continues to outperform Bitcoin in options open interest, particularly as end-of-year expirations approach. However, trading volumes have decreased, reflecting a general sense of caution in the market.
The options term structure for Ethereum shows higher realized volatility compared to future expectations, signaling a difference in sentiment from Bitcoin, which displays a flatter term structure.
As the crypto market continues to evolve, it’s essential for traders and investors to stay informed about market trends and developments. For more news and updates on the crypto market, visit Global Crypto News.
