Open Interest in Ethereum Futures Hits New All-Time High

Ethereum Futures

Open Interest in Ethereum Futures Hits New All-Time High

Interest in Ethereum keeps rising relentlessly as the total value of open Ethereum futures contracts hits a new all time high, and the price reacts the same way hitting a new two-year high.

It emphasizes the newly found confidence in the second largest cryptocurrency, something that had been lacking until the launch of the Medalla testnet earlier this month.

Open Interest in Ethereum Futures Hits New All-Time High

According to market analytics firm Skew, open interest on Ethereum futures has risen emphatically since the announcement of the Medalla testnet in late July.

ETH Futures ATH

As we can see, there was keen interest in Ethereum futures in Q1 of this year, and the aggregate open interest eclipsed $750 before the Black Thursday market crash, which saw all cryptocurrencies plunge by at least 50%.

However, as we can see, the interest in Ethereum futures didn’t subside, and since Black Thursday, the aggregate open interest in Ethereum futures has been steadily rising.

$1 billion was smashed just after the testnet announcement, and interest in Ethereum has grown more than 50% in the last three weeks, as there are now over $1.5 billion worth of outstanding contracts.

What Are Ethereum Futures Contracts?

Ethereum Futures Contracts are a financial contract agreement between two parties to buy or sell an Ethereum derivative at a set price at a predetermined date in the future.

Contract buyers expect ETH prices to be different from the contract price at the time of execution, allowing instant profit when filling their obligation.

Contract issuers earn a fee on contracts they sell, with the expectation that the fee will be greater than the loss of buying or selling the asset to fulfill their obligation.

It’s worth noting that futures trading is for the more sophisticated trader, and anyone new to the space, shouldn’t really get involved in it.

Ethereum Futures are traded on many cryptocurrency exchanges including BitMEX, Kraken and Binance.

Two-Year High for Ethereum Price and 2020 Highs For Transaction Fees

The new ATH in open Ethereum contracts coincides with the Ethereum price reaching a new two-year high, which saw ETH hit $442 late yesterday before retracing a to $438 at the time of writing.

Demand for Ethereum has been growing dramatically, thanks to the new testnet, interest in dApps and no doubt DeFi and the yield farming trend.

In fact, the demand for ETH has grown so much that transaction fees have rocketed by 3,500% since the start of the year.

In January, Gas fee was as little as $0.084, but the demand from DeFi has driven the cost of average transaction fee to above $3 now.

This is obviously a problem for the Ethereum network as a whole but it just emphasizes the interest that is flooding back into the Ethereum nexus.

Ethereum network is booming

Interest In The Ethereum Eco-System Is Growing Emphatically

After a long and arduous bear season, which saw Etherum slip from over $1300 to lows of $84 in December 2018, the good times are coming back to Ethereum and its eco-system.

With the price dropping as low as $114 after Black Thursday in March, the rise since then has been quite phenomenal.

Etheruem is the most developed on blockchain, and with dApps such as ChainLINK and Aragon performing amazingly, and of course DeFi creating a whole new financial system, interest and utility is beginning to flood the Ethereum network.

Added with the professional interest in the Ethereum futures reaching all time highs, it seems like the good times are back for the Ethereum community

Ethereum has a long way to go before it can handle what it set out to, but the fastest way it will get there is by all the interest that keeps flocking back.

Author: Pablo Clarke

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When I came up with Ethereum, my first first thought was, 'Okay, this thing is too good to be true.' As it turned out, the core Ethereum idea was good - fundamentally, completely sound