The recent approval of an Ethereum (ETH) ETF in the United States, specifically on May 23, generated an increase in optimism among cryptocurrency options traders. According to Aurelie Barthere, principal research analyst at Nansen, this move did not have a major impact on the ETH spot market, but it did have a notable effect on the implied volatility of call and put options.

Aurelie Barthere explained the current dynamics of the Ethereum options market: “Funding rates are neutral right now, although recent news about the ETH ETF has caused ETH call prices to jump relative to puts. Therefore, options traders are now bullish on ETH. ETH puts were the most expensive year-to-date, in absolute terms and relative to calls, as of March 28, 2024 (options traders are more bearish). After this date, put option prices declined until May 16 and then recovered some of this decline (possibly in anticipation of ETF approval). Call options have been more expensive than puts in recent days, which is to be expected.”

The Nansen analyst also suggested strategies for traders to take advantage of lower volatility to protect themselves: “Looking at the z-score of the difference between calls and puts can be used as a mean reversion strategy.”

In addition to the options market, the Ethereum ecosystem as a whole is experiencing significant changes. The ETF’s approval appears to have revived investor interest, with ETH-pegged exchange-traded products recording $33.5 million in inflows over the past week, reversing a previous negative trend of accumulated flows. Still in 2024, the total value locked in decentralized applications based on Ethereum rose 21% in the last 30 days, reaching more than 116 billion dollars and consolidating 70% dominance in the decentralized financial ecosystem, according to data aggregator DefiLlama.


The views and opinions expressed by the author, or anyone mentioned in this article, are for informational purposes only and do not constitute financial, investment or other advice. Investing or trading cryptocurrencies carries a risk of financial loss.


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