Ethereum Analysis: Derivatives Traders Bet Big on ETH Rally
Ethereum’s price has been lagging, but derivatives traders are betting big on an ETH rally. As of January 17, 2025, Ethereum’s derivatives open interest has crossed $30 billion, with a nearly 47% increase in options trade volume in the past 24 hours. The long/short ratio on Binance and OKX is greater than one, indicating that derivatives traders are bullish on an increase in Ethereum’s price.
Key Statistics
- Ethereum’s derivatives open interest: $30 billion
- Options trade volume increase: 47% in the past 24 hours
- Long/short ratio on Binance and OKX: greater than one
- Institutional capital inflow to Ether: nearly doubled on January 16, 2025, with $166.6 million in inflows
On-Chain Analysis
On-chain metrics also support a bullish thesis for Ethereum. According to Santiment data, the total supply of Ether held by large wallet investors has climbed steadily, indicating that traders continue to accumulate ETH despite its lackluster price performance in 2024. The total funding rate aggregated by Ethereum is mostly positive throughout January 2025, representing optimism and hope for price gain among traders.
Market Movers
Farside Investors data shows that institutional capital inflow to Ether nearly doubled on January 16, 2025, with $166.6 million in inflows. Rising institutional interest is typically bullish for Ether. Additionally, the rising activity on the chain from Layer 2 protocols supports a thesis of growth for Ether. Data from GrowThePie shows that Ethereum Layer 2 chains have experienced rapid growth in active addresses, increasing by over 300% in a year and surpassing 10 million weekly.
Technical Analysis and Price Forecast
The ETH/USDT weekly price chart shows Ether hovering around the $3,360 level. Two technical indicators, the Relative Strength Index (RSI) and the Moving Average Convergence Divergence (MACD), support a bullish thesis for Ethereum. The RSI is sloping upward and reads 53, while the MACD flashes consecutive green histogram bars. If Ethereum ends its consolidation and breaks above the December 2024 peak, the altcoin could target the $4,578 level and rally towards its previous all-time high at $4,878.
Vitalik Buterin’s Take on Ethereum Layer 2
Vitalik Buterin recently commented on Sony Block Solution Labs’ Soneium, stating that the project demonstrates how Ethereum Layer 2 is “great for businesses and users.” Buterin believes that the creation of a free market on the Layer 2 level makes it more accessible and useful for businesses and users, supporting the growth of the Ethereum ecosystem.
Predictions
Based on the analysis, it is likely that Ethereum’s price will rally towards its previous all-time high at $4,878. The bullish thesis is supported by derivatives traders’ outlook, on-chain metrics, and technical indicators. However, it is essential to note that the cryptocurrency market is highly volatile, and prices can fluctuate rapidly.
Key Predictions
- Ethereum’s price will break above the December 2024 peak and target the $4,578 level
- Ethereum’s price will rally towards its previous all-time high at $4,878
- Institutional interest in Ether will continue to rise, supporting a bullish thesis for Ethereum
- The growth of Ethereum Layer 2 protocols will contribute to the revenue of the underlying chain, supporting a thesis of growth for Ether
Actionable Insights
Investors and traders should keep a close eye on Ethereum’s price and market trends. The current bullish thesis supports a potential rally towards $4,878. However, it is essential to conduct thorough research and consider multiple perspectives before making any investment decisions.
