While Bitcoin (BTC) recently surged past $110,000, a growing number of institutional investors appear to favor Ethereum (ETH) in the near term. Despite ETH being down 20% in 2024, three strong market indicators suggest big money is shifting bullish sentiment toward ether.
1. Deribit Options Reveal Stronger Bullish Bias for Ether
Data from Deribit, the largest crypto options exchange, shows that ETH call options are priced higher than BTC calls, according to the 25-delta risk reversals.
Risk reversals measure sentiment by comparing implied volatility in calls vs. puts. A positive value indicates bullish demand.
Currently, both ETH and BTC exhibit a call bias, but ETH calls are trading at a richer premium, indicating traders are more optimistic about ether’s price upside compared to bitcoin.
2. CME Futures Show Explosive Growth in Ether Open Interest
Institutional activity is clearly shifting, as seen on the Chicago Mercantile Exchange (CME):
- Bitcoin futures open interest rose 70% to over $17B since early April but has now plateaued.
- In contrast, ETH futures open interest surged 186%, hitting $3.15B, and continues to climb rapidly.
This divergence signals stronger institutional accumulation of ether futures, despite BTC’s recent rally.
3. ETH Futures Premiums and Funding Rates Stay Elevated
Another sign of bullish sentiment lies in ETH futures premiums and perpetual funding rates:
- One-month ETH futures premium is at 10.5% annualized, its highest since January.
- BTC futures premium lags at 8.74%.
- On offshore platforms, ETH funding rates approach 8%, while BTC stays below 5%.
Higher premiums and funding rates indicate stronger long interest and market optimism for ether, despite it still trading 84% below its all-time high from 2021.
What This Means for the Market
While BTC remains the market leader by capitalization, these trends show that ETH is gaining favor among sophisticated traders.
Ethereum continues to dominate DeFi and tokenization sectors, making it a strategic long-term play for institutions.
As options, futures, and funding markets tilt in ETH’s favor, a reversal in performance gap between BTC and ETH may soon be on the horizon.