Originally published on: December 09, 2021
Recent data indicates that professional traders are currently more bullish on Ethereum than Bitcoin, reflecting the noticeable outperformance of Ether’s price compared to Bitcoin over recent months. The ETH/BTC ratio has surged more than 230% in 2021, reaching a new high at 0.089 BTC on Dec. 9.
Ether’s market capitalization of $490 billion now represents 54% of Bitcoin’s $903 billion, a significant increase from the 15% ratio seen at the end of 2020. While this may not fully meet the expectations of Ethereum maximalists, it is an impressive feat nonetheless.
Rather than speculating on the reasons behind this shift or making unreliable predictions, analysts should focus on understanding the market structures of each coin independently. Key metrics to consider include the futures market premium trends and the long-to-short ratio of professional traders.
Quarterly futures contracts are favored by whales and arbitrage desks due to their fixed settlement dates and lack of fluctuating funding rates. The difference between futures and spot market prices can provide valuable insights into market sentiment and potential price movements.
Comparing the premium rates of Bitcoin and Ethereum futures reveals that Ether is currently commanding a higher premium, signaling bullish sentiment among whales and arbitrage desks. Additionally, monitoring the long-to-short ratios of top traders on leading crypto exchanges can offer a broader perspective on market sentiment.
While Bitcoin traders have shown a decrease in long positions in recent weeks, Ether traders have displayed a more positive sentiment shift. The higher futures basis rate for Ether, combined with the improved long-to-short ratios, suggests that Ethereum may continue to outperform Bitcoin in the near future.
As always, it’s important to conduct your own research and due diligence before making any investment decisions. The insights shared here are based on data analysis and trends observed in the market, but individual trading strategies may vary. Stay informed and subscribe to our newsletter for more market updates and analysis.
