ETH Derivatives and OnChain Data Suggest Path to $2,600 Remains Open
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ETH derivatives gauges show professional traders remain calm and bearish despite recent DeFi exploits. Ethereum's 53% total value locked market share and institutional ETF demand continues to support around $2,200.
Ether's price rally stops, but ETH futures are far from bearish
After rising to $2,380 on Sunday, the Ether (ETH) price failed to sustain the high momentum. Repeated failures to breach the $2,400 mark over the past four weeks have gradually eroded confidence, suggesting that professional ETH traders may be jumping ship even as more derivatives and onchain metrics support further upside.
ETH Perpetual Future Annual Funding Amount. Source: Simplicity
ETH's perpetual futures annualized funding stood at 5% on Tuesday, slightly below the neutral range of 6% to 12%. While not particularly bullish, the gauge has distanced itself from the negative bearish volume seen last week.
ETH Options Call Ratio in Debit, USD. Source: Lavitas
As of May 4th, ETH options have been lower than call (buy) options on Deribit. Interest in neutral-to-bearish strategies has been flat for three weeks, so ETH whales and market makers aren't reversing their bears just yet.
Still, the lack of bullishness in ETH futures can be explained by external factors such as high oil prices and inflation. The U.S. consumer price index rose 3.8% in April, the highest in more than three years, driven by rising energy costs.
The Bureau of Labor Statistics report also contained bad news for workers, as real average hourly wages fell 0.5% from last month.
DeFi hacks and Ethereum foundation sales weigh on investor sentiment.
In addition to worsening macroeconomic conditions, the Ethereum ecosystem has faced internal struggles, including the hacking of several decentralized finance (DeFi) protocols. The Kelp DAO rsETH bridge uses LayerZero messaging, Disbursement of more than 290 million dollars From many lenders using fake collateral, including market leader Ave.
Recently, Ekubo Protocol lost $1.4 million due to EVM v2 swap vulnerabilities, while TrustedVolumes lost $6.7 million due to protocol logic flaws. These incidents stem from protocol-specific bugs and access control errors rather than flaws in Ethereum, EVM security, or Layer-2 bridge designs.
Recent ETH sales by the Ethereum Foundation and beyond 50 million dollars out of use It has created discomfort among investors. Sentiment took another hit after an Ethereum ICO participant transferred 10,000 ETH to a new wallet. Regardless of the reason behind these moves, fear and uncertainty remain high as ETH trades 54% below its all-time high.
Related: North Korea ‘Industrialized' Crypto Theft, Makes Billions – Certike
Blockchain Total Value Locked Market Share. Source: Defillama
Ether's strength lies in Ethereum's 53% Total Value Locked (TVL) market share and leadership in decentralized applications (DApp) when it comes to the Layer-2 ecosystem. No competitor can match its corporate appeal, which is evident from the Ethereum spot exchange-traded fund's (ETF) $11.6 billion in assets under management.
Ultimately, the lack of bullish interest in ETH futures should not be seen as a decrease in interest from pro traders, so the path to $2,600 and above is open.
