Surging Interest in Bitcoin ETFs Yet Ethereum Fails To Draw A Crowd

Despite their recent unpopularity, Bitcoin ETFs (Exchange-Traded Funds) have again been in the spotlight amongst the crypto derivatives trading community. In contrast, Ethereum-based products are currently less appealing due to the stagnant price movement of their underlying asset.

Spotlight on BlackRock’s Bitcoin ETF Application

The asset management giant, BlackRock, submitted its spot Bitcoin ETF application this month, sparking an inferno of interest among derivatives traders. That has resulted in a rush of speculators reinvesting in Bitcoin exchange-traded products, while the appetite for Ethereum funds has lessened.

On June 27, ‘Greeks.live,’ a renowned derivatives trading analysis feed, reported that the latest influx of Bitcoin ETF applications from large fund managers is fueling trading momentum. In their words, “These positive developments are propelling BTC forward, with today’s BTC block calls volume accounting for over one-third of the total volume.”

A Closer Look at Calls and Bitcoin’s Max Pain Price

Calls allow traders to purchase an asset at a predetermined strike price before the contract expires. Presently, traders are honing their focus on BTC contracts, primarily because the asset maintains a position above its max pain price.

In contrast, Ethereum contracts are experiencing a selloff due to the lackluster price performance when juxtaposed with Bitcoin, which has seen a rally over the past week. “Owing to the weakness in ETH prices, a significant number of market makers have continued to sell ETH calls, with buyers primarily focusing on BTC,” was the observation.

According to Deribit, a prominent derivatives analytics platform, BTC options calls vastly outweigh puts with a ratio of 0.33. This indicates a trend among Bitcoin ETF traders wagering that BTC prices will ascend rather than descend.

The Tale of Two Crypto Assets: Bitcoin vs. Ethereum

The cause of this disparity can be traced back to the recent market behavior of the two leading crypto assets. Over the past two weeks, Bitcoin has achieved a remarkable 17% increase, predominantly driven by the flood of Bitcoin ETF applications.

Conversely, Ethereum’s performance over the same period could have been better. It managed a modest 7% gain, and ETH prices have failed to surpass the psychological $2,000 threshold, signaling a potential pullback.

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