Market Wrap: Bitcoin Hits Record $48.2K as CME Ether Futures at $33M Volume on First Day

With all this bullish bitcoin activity, the ETH/BTC pair has gone bearish, a sign traders are selling ether for bitcoin.

CoinDesk 20 Bitcoin Price Index

Feb 9, 2021 at 9:52 p.m. UTC

Market Wrap: Bitcoin Hits Record $48.2K as CME Ether Futures at $33M Volume on First Day

Bitcoin and ether surpassed Monday’s price records. In ether’s case, CME’s futures launch has given the asset more credibility than ever before.

Bitcoin (BTC) trading around $47,174 as of 21:15 UTC (4:15 p.m. ET). Gaining 7.1% over the previous 24 hours.
Bitcoin’s 24-hour range: $43,948-$48,226 (CoinDesk 20)
BTC well above the 10-hour and the 50-hour moving average on the hourly chart, a bullish signal for market technicians.

Bitcoin trading on Bitstamp since Feb 6.

Bitcoin’s price is in mega-bull mode again Tuesday. For the second day in a row, the price per 1 BTC hit a new all-time high, $48,226, according to CoinDesk 20 data.

“Bitcoin’s rush from $38,000 to a high of $48,000 marks a new all-time high, blasting through the previous all-time high set a month ago, and reignites the recent bull run,” noted Jason Lau, chief operating officer for San Francisco-based cryptocurrency exchange OKCoin.

Bitcoin’s historical price the past three months.

“Elon [Musk] and Tesla’s [bitcoin] purchase of $1.5 billion and accepting bitcoin as payment is now the largest confirmation of a trend months in the making – corporations are worried about their cash reserves losing value and are taking concrete actions to diversify into bitcoin,” added Lau.

“Tesla’s $1.5B boost provides us a great example of leadership that will eventually push other S&P 500 companies to allocate part of their treasury reserve into bitcoin,” predicted Constantin Kogan, partner at crypto investment firm Wave Financial.

Kogan made an extremely optimistic forecast to CoinDesk. “If all S&P 500 companies allocate at least 1% of their treasury, the price of bitcoin would increase by about $40,000.”

Top 10 publicly traded companies by bitcoin holdings.

Interestingly enough, with all this bullish bitcoin activity, the ETH/BTC pair has gone bearish. It’s a sign traders are selling ether for bitcoin, with a particularly large red selling candle at 12:00 UTC Monday when BTC jumped on the Tesla news.

The spot ETH/BTC pair on Coinbase since Feb 6.

“Bitcoin having just hit all-time highs again, we might have a bit of a pullback for all tokens,” noted Andrew Tu, an executive at quant trading firm Efficient Frontier. ”In general though, the market looks bullish. It seems like bitcoin dominance is due to make another brief run upwards again as it’s hard to see alts (especially DeFi) continue to perform like they have recently without a break.”

On Tuesday, bitcoin’s dominance, its percentage of the larger crypto market share, has jumped. At one point it was up 2% for February and as of press time it is sitting at 0.94%.

Jean-Baptiste Pavageau, partner at ExoAlpha, told CoinDesk not to dismiss ether (ETH), the native asset of decentralized finance (DeFi) network Ethereum, during this run because it is also making gains Tuesday. “DeFi definitely fuels up the use of the Ethereum network and its leadership as one of the pillars of the future of finance.”

Ether futures volume $33 million first day on CME

Ether (ETH), the second-largest cryptocurrency by market capitalization, was up Tuesday, trading around $1,769 and climbing 3.1% in 24 hours as of 21:15 UTC (4:15 p.m. ET). The digital asset hit a fresh all-time high Tuesday of $1,824, according to CoinDesk 20 data.

“We expect some exhaustion on ether coming from the price itself, above $2,200, but also from the fees to use the network itself while solutions are being built to tackle this issue,” said Jean-Baptiste Pavageau, partner at quantitative trading firm ExoAlpha.

Monday was the first day for ether futures contracts on the commodity bellwether Chicago Mercantile Exchange. In total, there were 388 ether contracts traded by volume on the day. Each contract is 50 ETH each. At CME’s closing reference rate Monday of $1,732, there was $33.6 million in volume the first day, with $19.7 million in open interest at the close.

Investors will be keeping an eye on this market. Outside of CME, ether futures are already an almost-$6 billion market, with Binance leading the way with $1.3 billion in open interest Monday.

Ether futures open interest the past month.

“This is a big milestone for Ethereum and ether from several different angles,” noted Stefan Coolican, chief financial officer of Ether Capital, of the CME launch. “First, it provides clarity on ether as a commodity like bitcoin; second, it gives institutions a well-known and accessible way to access ether exposure; third, it provides another tool for price discovery that helps investors and regulators better assess market dynamics.”