Bitcoin traded flat, while Ethereum rose on Thursday night as the global cryptocurrency market capitalization rose 0.3% to $983.9 billion.
|Coin||24 hours a day||7 days||Price|
|Cryptocurrency||24-hour % change (+/-)||Price|
|Balance sheets (CAMPFIRE)||+9.7%||$7.81|
See also: Best Crypto Debit Card
Why it matters: The second largest coin was up amid the buzz surrounding the transition to a proof-of-stake mechanism. The top coin failed to make any significant moves.
Michael van de Poppe said that Ethereum “carries the entire market.” The cryptocurrency trader tweeted: “If the mainstream markets do a little bounce, we’ll likely accelerate pretty quickly with crypto to the upside.”
#Ethereum carries the entire market.
If the mainstream markets do a little bounce, we’ll probably accelerate pretty quickly with crypto to the upside.
— Michaël van de Poppe (@CryptoMichNL) 1 September 2022
Among other risk assets, stock futures were flat at press time as investors awaited US jobs data for August, due on Friday.
“The true test for Bitcoin is whether it can stay close to the $20,000 level after the NFP [Non-Farm Payroll] release. A warm labor market report and bets on interest rate hikes from the Fed could increase, and that could trigger downward pressure looking at the summer declines, he says. Edward Moyasenior market analyst at OANDA.
Justin Bennett shared two charts on Twitter, saying either the dollar index or the S&P500 is “wrong,” adding that “the reaction to Friday’s NFP should give us an answer.”
One of these markets is wrong.
— Justin Bennett (@JustinBennettFX) 1 September 2022
On the Ethereum side, derivatives are dominant ahead of the “Blend”. Kaiko Research pointed to the share of perpetual futures volume between BTC and ETH, saying the latter had 45% of volume at the beginning of August to 57% by the end of the month.
BTC/ETH Daily Perpetual Futures Volume — Courtesy of Kaiko Research
The cryptocurrency market data provider, in a note seen by Benzinga, also pointed to open interest – a measure of how many futures positions are open at any given time and the amount of capital invested in the futures.
Kaiko said that ETH-denominated open interest shows that “the number of futures positions open at this time represents a staggering all-time high, acting as a massive leveraging force on the price action of ETH over the coming weeks.”
ETH Open interest denominated in ETH — Courtesy Kaiko Research
The data provider said funding rates nearing the end of August have fallen sharply. “This dip negative, coinciding with a build-up in open interest, leads us to conclude that the majority of the new money piling into ETH futures markets is short-biased,” Kaiko said.
Perpetual daily volume in ETH has risen from $19 billion to over $33 billion in the past year. In a corresponding period, the daily spot volume rose from USD 3.7 billion to USD 4.8 billion.
ETH Perpetual Future and Spot Volume — Courtesy Kaiko Research
Converting these volumes into a ratio, Kaiko said we can see the “increasing dominance of ETH perpetual futures volume as the ratio of perps to spot volume has increased from 5x volumes to about 7.”
ETH Perpetual Future To Spot Volume Ratio — Courtesy of Kaiko Research
“With an increasing dominance of perpetual futures volume versus spot markets, derivatives markets are currently having outsized effects on price action,” Kaiko Research concluded.
“The merger is one of the only events in crypto lately that hasn’t been macro-driven, and it will be interesting to see if it triggers a breakout towards a lower correlation with the stock market, for better or for worse.”
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