ETH futures launched on Chicago’s CME on February 7. On the eve of the launch, the price of Ethereum renewed its all-time high, soaring above $1760. But later, ETH corrected noticeably.
As expected, the leading altcoin was in a growth phase for a long time before the launch of futures on the Chicago Mercantile Exchange. CME announced this event back in December 2020. The ETH maximum price was reached on February 5, after that, a correction followed. Experts believe that investors have taken profits and invested in bitcoin. Bitcoin dynamics confirms this.
Investors and traders are taking into account historical data. Back in 2017, CME launched bitcoin futures, then BTC peaked at over $20K just before the launch. And after the launch of BTC futures, it began to decline, its price dropping for three years, though there were some periods of upward movement. The current situation in the crypto market is not the same as it was three years ago, but investors preferred to hedge their funds.
Ethereum is now a much more sustainable cryptocurrency than bitcoin was in 2017. Its potential is supported by several fundamental factors. First of all, this is an update, that is, a transition to Ethereum 2.0 with a Proof-of-Stake consensus. This makes the blockchain more sustainable, less energy-consuming, and increases the performance up to 100 thousand TPS. Bitcoin operates on the most expensive Proof-of-Work consensus with a speed of 3 to 7 TPS. The bitcoin blockchain does not allow the launch of smart contracts. Ethereum blockchain was created to run smart contracts. This functionality has received the best commercial implementation to date in decentralized finance (DeFi).
DeFi projects are launched mainly on Ethereum, even before the update. And they will be launched on Ethereum 2.0 definitely. Obviously, the sum of Ethereum’s advantages should keep its price from falling in any type of trading including futures. But traders once again demonstrated the illogicality of their behavior. In an attempt to anticipate the development of the situation, analysts said that the drop would not be prolonged. Seems they are right. Almost immediately after reaching a new all-time high of $1760, ETH dropped to $1490 but then began to rise again. However, the dynamics of its growth is not so good as the dynamics of BTC.
The king of cryptocurrencies has overcome the psychologically significant level of $40K and is growing further at a rapid pace. This confirms the assumption that a significant portion of investors actually got money from Ethereum and invested in bitcoin.