Bitcoin
BTC$64 281.02

-0.74%

Ethereum
ETH$3 503.03

-0.11%

Tether
USDT$0.999382

0.01%

Binance Coin
BNB$583.59

-0.50%

Solana
SOL$134.72

1.24%

USD Coin
USDC$0.999969

0%

Ethereum price moves toward new highs even as pro traders turn bearish


22 Apr 2021

#Ethereum

Ether's price is back on the path to a new high, but this key ETH derivatives metric signals that pro traders are exercising caution. The price of Ether (ETH) fell by 19.6% on April 18, resulting in the quick liquidation of $1 billion in long futures contracts. Despite the size of this record liquidation and its impact on Ether's price, the futures open interest remained above $20.5 billion, which is 5% below the previous month.

After the sell-off, there were signs that investor sentiment deteriorated, which was evident in derivatives markets. Historically, there's much higher borrowing demand for Ether longs as opposed to shorts. Over the past couple of days, the long-to-short ratio has flipped, reaching the lowest level since December 2018.

There's hardly any news that could justify the substantial price correction, as Ether has no direct relation with Coinbase shares receding, Bitcoin's (BTC) falling hash rate or TV host Jim Cramer calling Bitcoin "phoney money."

However, investors have reason to worry about potential harsh cryptocurrency regulation. Over the weekend, unsubstantiated news that the United States Department of Treasury would bring money laundering charges emerged. The focus would be financial institutions that have used cryptocurrencies, but little has come of this.

In February, Janet Yellen, secretary of the Treasury and a known crypto critic, cited the misuse of cryptocurrencies for illegal activities as a growing concern. Meanwhile, the Treasury's Financial Crimes Enforcement Network signaled that the reporting of foreign financial accounts could include digital currencies. The potential move means FinCEN may soon require individuals to file annual Reports of Foreign Bank and Financial Accounts, or FBARs, for cryptocurrencies held on foreign exchanges.

Therefore, investors' increased interest in Ether shorts could have been fueled by the potential regulatory changes. Curiously, Ether's price currently stands less than 5% below its $2,550 all-time high. As the above chart shows, the average demand for Ether longs at exchange Bitfinex has been 65% higher than shorts over the last couple of months. On April 20, this indicator shifted, favoring the shorts and reaching its lowest level since December 2018.

Ethereum network congestion is another reason causing traders to act more carefully. Over the past couple of months, the average transaction cost stood near $16, making it quite impractical for individuals looking to facilitate smaller transactions.

The recent Berlin update has laid the groundwork for the much bigger London hard fork, which will activate EIP-1559. The controversial change will overhaul Ethereum's existing fee structure, but experts have stated that the new base fee mechanism would not provide a long-term solution for Ethereum' scalability problems.

Whatever the reason behind Bitfinex's margin markets shifts favoring bears, there's no indicator better than the 20% ETH price increase that took place over the previous four days. As of now, this isolated indicator should not be deemed worrisome, and it appears that Ether's price is en route to new all-time highs.


Related

Crypto may be ready for a new leg down
Crypto may be ready for a new leg down
Cryptocurrencies wait for a signal
Cryptocurrencies wait for a signal
What are dynamic NFTs?: Use cases and examples
What are dynamic NFTs?: Use cases and examples
Shanghai Upgrade Fires Up ETH and Altcoins
Shanghai Upgrade Fires Up ETH and Altcoins
Challenges of data accessibility in the NFT market
Challenges of data accessibility in the NFT market
Is the A.I. revolution about to pump Nvidia stocks?
Is the A.I. revolution about to pump Nvidia stocks?
Five tips for investing during a global recession
Five tips for investing during a global recession
What is NFT ticketing and how does it work?
What is NFT ticketing and how does it work?
The crypto market is cheaper than a trillion again
The crypto market is cheaper than a trillion again

Top Cryptocurrencies with Price Predictions

# Crypto Prediction Accuracy CVIX Price 24h 7d Market Cap 7d price change
1 Bitcoin (BTC) BTC Bitcoin predictions 88.8% 17 $64 281.02 -0.74% -2.87% $1 267 309 855 276 BTC 7 days price change
2 Ethereum (ETH) ETH Ethereum predictions 83.6% 22 $3 503.03 -0.11% 0.57% $428 336 932 629 ETH 7 days price change
3 Tether (USDT) USDT Tether predictions 94.8% 1 $0.999382 0.01% -0.01% $112 821 536 179 USDT 7 days price change
4 Binance Coin (BNB) BNB Binance Coin predictions 81.6% 26 $583.59 -0.50% -3.16% $86 118 467 479 BNB 7 days price change
5 Solana (SOL) SOL Solana predictions 72% 62 $134.72 1.24% -6.22% $62 241 107 190 SOL 7 days price change
6 USD Coin (USDC) USDC USD Coin predictions 93.2% 3 $0.999969 0% 0% $32 729 450 112 USDC 7 days price change
7 XRP (XRP) XRP XRP predictions 82.8% 33 $0.488000 -0.20% 2.68% $27 141 690 253 XRP 7 days price change
8 Dogecoin (DOGE) DOGE Dogecoin predictions 62.8% 76 $0.124225 -0.04% -8.03% $17 988 814 267 DOGE 7 days price change
9 Toncoin (TON) TON Toncoin predictions 69.6% 59 $7.10 -0.48% -12.07% $17 464 050 127 TON 7 days price change
10 Cardano (ADA) ADA Cardano predictions 72.4% 61 $0.376540 -2.50% -8.29% $13 456 943 133 ADA 7 days price change
11 Avalanche (AVAX) AVAX Avalanche predictions 63.6% 73 $27.28 -1.70% -9.96% $10 740 352 979 AVAX 7 days price change
12 SHIBA INU (SHIB) SHIB SHIBA INU predictions 55.6% 94 $0.000018 -0.57% -11.10% $10 569 562 911 SHIB 7 days price change
13 TRON (TRX) TRX TRON predictions 95.2% 1 $0.118022 1.14% 1.42% $10 296 940 484 TRX 7 days price change
14 Lido stETH (STETH) STETH Lido stETH predictions 92.4% 1 $2 941.39 -0.40% -3.32% $10 258 752 564 STETH 7 days price change
15 Wrapped TRON (WTRX) WTRX Wrapped TRON predictions 91.2% 1 $0.116354 -0.46% 0.23% $10 171 995 609 WTRX 7 days price change

Be the first to receive Cryptocurrency Price Predictions and Forecasts daily

Get cryptocurrency price predictions, forecasts with analysis and news right to your inbox.

© 2015-2024 Crypto-Rating.com

The usage of this website constitutes acceptance of the following legal information. Any contracts of financial instruments offered to conclude bear high risks and may result in the full loss of the deposited funds. Prior to making transactions one should get acquainted with the risks to which they relate. All the information featured on the website, including information about the cryptocurrencies and bitcoin is intended solely for informational purposes, is not a means of advertising them, and doesn't imply direct instructions for investing. Crypto Rating shall not be liable for any loss, including unlimited loss of funds, which may arise directly or indirectly from the usage of this information. The editorial staff of the website does not bear any responsibility whatsoever for the content of the comments or reviews made by the site users about cryptocurrencies. The entire responsibility for the contents rests with the authors. Reprint of the materials is available only with the permission of the editorial staff.