{"id":7272,"date":"2022-09-20T18:08:29","date_gmt":"2022-09-20T18:08:29","guid":{"rendered":"http:\/\/cryptoheretostay.com\/?p=7272"},"modified":"2022-09-20T18:08:31","modified_gmt":"2022-09-20T18:08:31","slug":"state-of-ethereum-derivatives-market-post-merge","status":"publish","type":"post","link":"https:\/\/cryptoheretostay.com\/?p=7272","title":{"rendered":"State of Ethereum derivatives market post-Merge"},"content":{"rendered":"<p> <script type=\"text\/javascript\">\r\namzn_assoc_placement = \"adunit0\";\r\namzn_assoc_tracking_id = \"totafreearti-20\";\r\namzn_assoc_ad_mode = \"search\";\r\namzn_assoc_ad_type = \"smart\";\r\namzn_assoc_marketplace = \"amazon\";\r\namzn_assoc_region = \"US\";\r\namzn_assoc_default_search_phrase = \"crypto\";\r\namzn_assoc_default_category = \"All\";\r\namzn_assoc_search_bar = \"false\";\r\namzn_assoc_title = \"\";\r\namzn_assoc_rows =\"1\";\r\n<\/script>\r\n<script src=\"\/\/z-na.amazon-adsystem.com\/widgets\/onejs?MarketPlace=US\"><\/script><br \/>\n   <\/p>\n<p>Previous research conducted by CryptoSlate suggested the Ethereum Merge would be a buy-the-rumor, sell-the-news event.<\/p>\n<p>With that coming to pass, as ETH sunk 20% over the last seven days, what does a current analysis of the derivatives market reveal?<\/p>\n<h2>Ethereum Futures Perpetual Funding Rate<\/h2>\n<p>Perpetual Funding Rates refer to periodic payments made to or by derivatives traders, both long and short, based on the difference between perpetual contract markets and the spot price.<\/p>\n<p>During periods when the funding rate is positive, the price of the perpetual contract is higher than the marked price. Therefore, long traders pay for short positions. In contrast, a negative funding rate shows perpetual contracts are priced below the marked price, and short traders pay for longs.<\/p>\n<p>They differ from standard futures contracts in that the perpetual element means traders can hold positions without the contract expiring. But the purpose of funding rates is to serve as a mechanism for keeping contract prices in line with spot markets.<\/p>\n<p>The chart below shows that as the Merge approached, traders were paying almost 1,200% annualized funding rates to short Ethereum. The scale of shorting surpassed the levels seen during the height of the covid crisis.<\/p>\n<p>Post-Merge, the funding rate has reverted to near neutral, suggesting short-term speculation is over, and the funding premium has vanished accordingly.<\/p>\n<p>Source: Glassnode.com<\/p>\n<h2>Options Put vs. Call Open Interest<\/h2>\n<p>Open Interest refers to the number of active options contracts. These are contracts that have been traded but not yet liquidated by an offsetting trade or assignment. A put option is the right to sell at a specific price by a specified date, whereas a call is the right to buy at a particular price by a specified date.<\/p>\n<p>The chart below showed both put and call options have sunk post-Merge. Calls remain elevated, with more than $5 billion still in force, whereas puts remain relatively muted.<\/p>\n<p>This suggests traders are still willing to go long despite the post-Merge price correction.<\/p>\n<p>Source: Glassnode.comPosted In: Ethereum, Research<\/p>\n<h2>Get an Edge on the Crypto Market \ud83d\udc47<\/h2>\n<p>Become a member of CryptoSlate Edge and access our exclusive Discord community, more exclusive content and analysis.<\/p>\n<p>  <strong>On-chain analysis<\/strong><\/p>\n<p>  <strong>Price snapshots<\/strong><\/p>\n<p>  <strong>More context<\/strong><\/p>\n<p> Join now for $19\/month Explore all benefits<br \/>\n<br \/><script type=\"text\/javascript\">\r\namzn_assoc_placement = \"adunit0\";\r\namzn_assoc_tracking_id = \"totafreearti-20\";\r\namzn_assoc_ad_mode = \"search\";\r\namzn_assoc_ad_type = \"smart\";\r\namzn_assoc_marketplace = \"amazon\";\r\namzn_assoc_region = \"US\";\r\namzn_assoc_default_search_phrase = \"bitcoin\";\r\namzn_assoc_default_category = \"All\";\r\namzn_assoc_search_bar = \"false\";\r\namzn_assoc_title = \"\";\r\namzn_assoc_rows =\"1\";\r\n<\/script>\r\n<script src=\"\/\/z-na.amazon-adsystem.com\/widgets\/onejs?MarketPlace=US\"><\/script><br \/>\n<br \/><a href=\"https:\/\/cryptoslate.com\/state-of-ethereum-derivatives-market-post-merge\/\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Previous research conducted by CryptoSlate suggested the Ethereum Merge would be a buy-the-rumor, sell-the-news event. With that coming to pass, as ETH sunk 20% over the last seven days, what does a current analysis of the derivatives market reveal? Ethereum Futures Perpetual Funding Rate Perpetual Funding Rates refer to periodic payments made to or by [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":7273,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_wp_rev_ctl_limit":""},"categories":[3],"tags":[],"class_list":["post-7272","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-ethereum-news"],"_links":{"self":[{"href":"https:\/\/cryptoheretostay.com\/index.php?rest_route=\/wp\/v2\/posts\/7272","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/cryptoheretostay.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/cryptoheretostay.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/cryptoheretostay.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/cryptoheretostay.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=7272"}],"version-history":[{"count":1,"href":"https:\/\/cryptoheretostay.com\/index.php?rest_route=\/wp\/v2\/posts\/7272\/revisions"}],"predecessor-version":[{"id":7274,"href":"https:\/\/cryptoheretostay.com\/index.php?rest_route=\/wp\/v2\/posts\/7272\/revisions\/7274"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/cryptoheretostay.com\/index.php?rest_route=\/wp\/v2\/media\/7273"}],"wp:attachment":[{"href":"https:\/\/cryptoheretostay.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=7272"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/cryptoheretostay.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=7272"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/cryptoheretostay.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=7272"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}