The volume of the Ethereum options market hit a record high as the demand for ETH has increased in recent weeks. What follows is the high profile confirmation of the Eth2 release, which was formalized after the deposits to the Eth2 contract address reached their threshold.
Analysts at Deribit, the largest cryptocurrency options market, said:
“Our open interest in the ETH option is a new ATH of 826 million US dollars! The course of Christmas Day leads with over 669,000 ETH OI. Put / call ratio of ETH for this strike: 1.19 The maximum pain of ETH for the end of December 25th is 400 USD! “
As a result, Ethereum could see increased volatility near December 25th as the big options expiration approaches.
The foundations for Ethereum are strengthening
The general increase in Ethereum trading activity is reflected in improving fundamentals.
For example, on-chain analytics firm intotheblock reported that the Ethereum network’s hash rate has remained at an all-time high. This is an indication of the growing demand for ETH as miners continue to devote their resources to the aggressive mining of ETH.
In the near future, mining on the Ethereum blockchain network would continue despite the Eth2 release. As long as mining coexists on Ethereum, the rising hash rate will remain a positive metric for ETH.
The Eth2 network upgrade will switch Ethereum from the PoW consensus algorithm (Proof-of-Work) to the PoS (Proof-of-Stake) algorithm, eliminating the need for mining. But in the foreseeable future, the PoW chain would coexist with the beacon chain. Intotheblock analysts said:
“While the launch of the beacon chain for # Ethereum miners marks the beginning of the end, the network’s hash rate has stayed near its all-time high. Although the creation of the beacon chain went live, the verification of the work chain will continue to work in parallel. “
Analysts have highlighted the growing interest in various subsectors of the Ethereum ecosystem. As an example, Mythos Capital co-founder Ryan Sean Adams reported that 1% of the total ETh supply is now pegged in ETH bonds.
Adams noted that this shows that many people are seeking exposure to the Ethereum economy, which is an indication that people are viewing ETH as money. He wrote:
“There is already 1% of the entire ETH supply in ETH bonds. Not even a week after launch. There is a clear demand for internet non-government bonds. People want to have contact with the Ethereum economy. And these bonds are in money. Because ETH is money. “
Given the increasing trading activity, the additional scalability of Eth2 and the noticeably increasing demand for ETH as money, analysts say, Ethereum’s long-term growth trajectory remains positive.
The data from the Ethereum options market also explains the massive volatility that ETH has seen so far. There are growing calls from traders expecting an increase in volatility in Ethereum, especially due to a critical network upgrade.
The volume of options after Ethereum hits a record high – but why is demand increasing? first appeared on CryptoSlate.