Traders pile $20m into Ethereum bets as ETF launch looms — here’s where they see the price heading

Traders have put $20 million on bullish bets that suggest that Ether will rally on the back of the launch of spot Ethereum exchange-traded funds, with others expecting the cryptocurrency will hit new record highs later this year.

The trades — puts and calls on options that expire on July 26 compiled by tracker basedmoney — come as market watchers expect spot Ethereum ETFs to launch on July 23.

“It appears the majority of traders see the ETF as a catalyst for price action to the upside,” Bartosz Lipinski, CEO of crypto exchange Cube.Exchange, told DL News.

Market watchers hope that spot Ethereum ETFs can replicate the success of similar Bitcoin funds that launched in January and catapulted the cryptocurrency to a new all-time high in March.

Ether trades 30% below its all-time high of $4,878.

Bullish bets

Traders piled $20 million into bets that pay off when the price gains.

Of the 467,220 bets made on trading platform Deribit, about 7% are for payouts when the price reaches $4,000, making it the biggest position for the July 26 expiration.

Over 31% of trades that expire on July 26 pay out in the range of $4,100 to $6,000.

However, “a not insignificant amount” of almost 5% of trades were at the $3,000 strike, he added.

This shows “that a decent minority of traders are taking the contrarian stance that ETH could drop on the debut,” Lipinski said.

He suggested that these trades represent a hedge against the same sell-off that happened shortly after spot Bitcoin ETFs were launched.

Lipinski added that bullish bets, or calls, outweigh bearish ones, or puts, “at virtually every expiry,” which suggests that the market is optimistic about Ether’s price in the months ahead.

“The further out into the future we look, the more bullish sentiment grows,” Lipinski said.

The number of open contracts for bets that pay off on December 27 for prices at $5,000 and $6,000 is “well above any other level, and says to me that the market believes ETH could hit a new high by the end of the year,” he added.

Crypto market movers

• Bitcoin is down 1.8% over the past 24 hours to trade at $63,913.
• Ethereum is down 0.9% to $3,409.

What we’re reading

• Why is Ryan Selkis so angry? Inside the Messari CEO’s jump from Biden to Trump — DL News.
• Mt. Gox Creditors Face Unauthorized Login Attempts Amid Bitcoin Repayments — Milk Road.
• Grayscale Fees for Spot Ethereum ETF 10 Times Higher Than Competition — Unchained.
• Cardano Co-Founder: Vote For Biden Is A Vote For Death Of US Crypto Industry — Milk Road.
• How a hacker just stole $235m from Indian crypto exchange WazirX — DL News.

Eric Johansson is DL News’ News Editor. Got a tip? Email at eric@dlnews.com.