31 July 2024
Regardless of both their maturity in the market, Bitcoin and Ethereum rivalry persists. According to recent insights from QCP Capital, a global digital asset trading firm and market maker, Ethereum appears to have now shown potential for larger price fluctuations compared to Bitcoin. QCP reveals that the volatility premium between these two major cryptocurrencies has seen a notable increase, with Ethereum leading in potential price swings.
ETH to see Larger Price Swings than BTC
Delving further into the insights shared, QCP Capital disclosed that it has observed Ethereum’s volatility premium over Bitcoin expanding to 8%, up from 4% just last week. This widening gap, according to QCP highlights a growing trend where Ethereum is expected to outpace Bitcoin in terms of price volatility. Particularly, the analysis suggests that Ethereum could offer more lucrative opportunities for those willing to capitalise on its market movements.
Related Reading: Ethereum’s Breakout Moment: Here’s Why ETH Could Skyrocket to $15,000 Soon
Furthermore, besides the impending surge in volatility, Ethereum’s market behaviour continues to diverge from that of Bitcoin, with its performance holding relatively steady even amid broader market shifts. Analysts from QCP Capital have pointed out that despite recent market uncertainties, including significant movements of Bitcoin by the US government, ETH has managed to sustain its market position more effectively than its counterpart.
The analysts noted:
ETH spot has performed relatively well compared to BTC following Trump’s speech, with ETHBTC gaining 5% since, despite its fourth consecutive day of spot ETF outflows. Why the strength in ETH? The market might be becoming immune to headline outflow figures due to the rotation from more expensive ETHE to the cheaper ETFs.
They note that if the current trend of outflows from instruments like the Grayscale Ethereum Trust begins to slow, and inflows into Ethereum ETFs pick up, “could ETH break significantly higher?”
Suggesting a trade idea, the QCP Capital analysts added:
While we maintain a range-trading outlook for BTC as re-iterated yesterday, we favor accumulating ETH at its current discount, as volatility has picked up slightly.
Ethereum and Bitcoin Market Performance
While both Ethereum and Bitcoin have seen a negative performance in price over the past week, there remains a notable difference when being specific. For instance, over the past week, Bitcoin has decline by 1.4% however, Ethereum on the other hand has plunged 4.2% over the same period.
Meanwhile, in the past 24 hours, Ethereum has seen an increase of 1.2% bringing its price to trade at $3,314 while Bitcoin still remains in the red down by 1.4% over the same period to trade at a price of $66,292, at the time of writing.
According to prominent crypto analyst Micheal Van De Poppe, the crucial level for ETH/BTC is 0.0515. If that price mark breaks, Van De Poppe predicts that then “it’s party time” as this would be the “strong first signs of the week.”
For the first time, since the launch of the #Ethereum ETF, price rallied back upwards during U.S. hours.
Crucial levels are 0.0515 BTC. If that breaks, it’s party time.
Strong first signs of the week. pic.twitter.com/DysOtKMQpJ
— Michaël van de Poppe (@CryptoMichNL) July 30, 2024
Featured image created with DALL-E, Chart from TradingView