Ethereum Futures and Options Volumes Decline as Institutional Interest Fades: Market Data
Ethereum derivatives trading volumes on the Chicago Mercantile Exchange (CME) have witnessed a sharp decline subsequent to the introduction of spot Ethereum exchange-traded funds (ETFs), indicating a diminished interest from institutional investors.
In August, the trading volumes for Ethereum derivatives on the CME exchange experienced a notable decrease. Ethereum futures volume plunged by 28.7% to $14.8 billion, while options volume dropped by 37.0% to $567 million, reaching their lowest levels since December 2023.
Data from CCData reveals that this downturn occurred shortly after the launch of spot Ethereum ETFs in late May, suggesting a lack of anticipated institutional interest in the asset.
Overall, CME’s derivatives trading volume decreased by 1.16% to $129 billion during this period. In contrast, Bitcoin (BTC) futures saw a 3.74% increase to $104 billion, while Bitcoin options trading declined by 13.4% to $2.42 billion. This decline in Ethereum (ETH) trading volumes stands in stark contrast to Bitcoin’s strong performance, with Bitcoin surging over 45% this year compared to Ethereum’s more modest 20% increase.
Crypto analyst Noelle Acheson, as reported by crypto.news, attributed the waning institutional interest in Ethereum ETFs to investors’ preference for Bitcoin as a means of diversification. Acheson drew a parallel between the current ETF landscape and the metals market, where gold ETFs hold over $100 billion in assets, significantly more than silver ETFs with less than $20 billion. Nevertheless, Acheson anticipates a potential growth in Ethereum ETF inflows as institutional investors’ interest in the asset may rise over time.
The decreased performance of Ethereum can also be attributed to the escalating competition from other cryptocurrencies like Solana (SOL) and TRON (TRX), which are garnering significant attention. Additionally, seasonal effects in August might have contributed to the reduced trading activity, with expectations that this trend could persist into September.
