Bitcoin ETF is gaining popularity among cryptocurrency derivatives traders. However, Ethereum-based products are currently less attractive due to the lackluster price action of ETH.
BlackRock’s introduction of a Bitcoin ETF spot application this month has sparked renewed interest among derivatives traders. As a result, speculators have returned to Bitcoin exchange-traded products, showing less enthusiasm towards Ethereum funds.
Bitcoin ETF makes a comeback
On June 27th, the derivatives trading analytics provider ‘Greeks.live’ reported that the latest wave of Bitcoin ETF applications by major asset managers has spurred trading momentum.
“These positive developments are driving BTC, with BTC call order volume accounting for over one-third of the total volume.”
A call option is when a trader selects to purchase an asset at a predetermined price before the agreement expires. Furthermore, buyers are currently focusing on BTC contracts due to the asset still trading at relatively high prices.
Due to the slight increase in ETH price, a significant number of market makers have continued to sell ETH call options, while buyers are focusing more on BTC.
According to derivatives trading analytics platform Deribit, BTC call options significantly outnumber put options with a ratio of 0.33. This indicates that many Bitcoin ETF traders are betting on the price of BTC to increase rather than decrease.
The price action of BTC versus ETH
The divergence stems from recent market volatility between the two leading cryptocurrencies. Over the past two weeks, Bitcoin has experienced an impressive 17% increase, primarily driven by the influx of Bitcoin ETF applications.
As a result, the digital gold has surged to a new peak in 2023 at $31,185 on June 24th and has been maintaining above $30,000.
On the contrary, Ethereum has only achieved a 7% increase compared to the same period. Furthermore, the price of ETH failed to reach the $2,000 target and has started to decline. Ethereum has been trading steadily at $1,866 throughout the day.
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