Ether futures in demand ahead of the Merge

Ether futures in the spotlight

It’s Merge time already, and investors are making their moves evident by showing an increased interest in futures contracts. Not just Ether, but derivative contracts involving ETH are also witnessing a surge in demand. Global markets firm CME Group has reported a 15% increase in the daily volume of ETH-based futures contracts in September, compared to August.

The open interest (market activity for futures contracts) has seen a steady increase over the past few weeks. Based on CME Group disclosure to Blockworks, ADV (Average Daily Volume) of the ETH contracts has gone up to 7,100. The ADOI (Average Daily Open Interest) has also shot up by almost 10% month-on-month. These statistics show that the Merge is still not completely priced in, and people are placing long-term calls on the future price movements.

A futures contract is like a predetermined price commitment to be settled on a future date. An increase in the futures contract activity means that more people are looking closely at the market, especially with less than 24 hours to go for the Ethereum merge.

Are there other trends worth watching?

While Ether future contracts have seen a steady increase, micro-ETH futures contracts have outperformed in most cases. To elaborate, one micro-ETH futures contract is equal to one-tenth of one ether or 1/500 times that of a standard Ether derivative contract. The growth of micro-ETH futures contracts shows that people with small investments too are dipping their toes into the long-term space.

While 62 ETH futures contracts are active, the number is as high as 139 for the micro-ETH futures contracts, a CME Group spokesperson told Blockworks.

Another notable trend is that while the number of micro-ETH futures contracts remains steady at 139, the September ADV and ADOI have dropped by 12% and 9%, respectively, compared to August.

Disclaimer: Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. The information provided in this post is not to be considered investment/financial advice from CoinSwitch. Any action taken upon the information shall be at the user’s risk

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