Ether Shines Brighter than Bitcoin in Cryptocurrency Spot and Derivative Markets
After the United States’ presidential election on November 5th, Ether (ETH) has outshined Bitcoin (BTC) in both spot and derivative markets. According to a report by crypto exchange Bybit, dated December 2nd, ETH’s momentum continues to grow.
Growing Demand for ETH Options
In November, Ether experienced significant traction against BTC, as evident from the sharp drops in their spot price ratio. Block Scholes, a market researcher, co-created Bybit’s ‘Volatility Review’ for November 2024. This review highlights the growing demand for ETH options, which indicates that traders are increasingly favoring ETH.
Additional Momentum and Attention
Ether’s outperformance accelerated after US Securities and Exchange Commission Chair Gary Gensler announced his plans to step down on November 21st. According to Bybit’s report, this announcement brought additional momentum and attention to the asset. Since then, Ether’s recent move has been sustained.
Source: CoinStats
Related:
- SEC Chair Gary Gensler to Step Down
- Is Altseason Here?
ETH Dominance in Spot Markets
Bybit reports that ETH’s mounting dominance is most evident in spot markets. The ratio of ETH to BTC has risen from approximately 0.0325 on November 21st to more than 0.04 as of December 6th, according to TradingView.
Felix Hartmann, the founder of Hartmann Capital, believes that the pivot from BTC to ETH is a signal that Wall Street is "officially joining the fun" on the "alt rotation." This shift in market attention has led to significant changes in investment flows.
Investment Flows
During the week of November 26th, Bitcoin funds saw outflows of $457 million – the first significant outflows since September. In contrast, ETH funds experienced inflows of $634 million during the same period, according to CoinShares’ December 2nd weekly digital asset fund flows report.
Bitcoin’s Dominance Wanes
Bitcoin’s crypto market dominance has been waning, falling from a high of more than 58% on November 21st to less than 52% as of December 6th, according to CoinStats. This decrease in dominance indicates that other cryptocurrencies, such as ETH, are gaining traction.
Expecting Volatility
Traders are bracing for a rise in ETH volatility, according to Bybit. In November, options markets experienced a surge in ETH volatility, pointing to a stronger demand for ETH optionality than BTC. According to Bybit, this is a return to usual programming for the pair rather than an unusual dislocation.
ETH’s Volatility
Throughout almost its entire history, Ether has moved with high correlation but much larger volatility than Bitcoin. This increased volatility may be indicative of growing market attention and investment in ETH.
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