According to cryptocurrency analysts, traders are expecting much larger price fluctuations for Ethereum (ETH) compared to Bitcoin (BTC) as important macroeconomic events are imminent.
Derive founder Nick Forster said in an Oct. 2 analysis note reviewed by Cointelegraph that Ethereum futures volatility (the expected future volatility of the Ethereum price) is expected to surge from Oct. 25, the day of the U.S. presidential election, to Nov. 8. pointed out. Election on November 5th.
US election will have “significant impact” on ETH price
Forster said next month’s U.S. election could have a “significant impact” on the price of ETH due to its relationship with the decentralized finance (DeFi) ecosystem and could be “subject to regulatory scrutiny” depending on whether a cryptocurrency-backed candidate is elected president. emphasized. .
ETH vs BTC at-the-money implied volatility chart. Source: Derived
According to Derive data, traders predicted a 68% chance that prices would move between -14% and +16% within three days of the US presidential election on November 5, with a 68% chance of the price moving between -26% and +16%. It was predicted to be 95%. 35%.
At the time of publication, ETH futures volatility is 76.6% and BTC is 69.8%. “This means traders are expecting significant moves during this period and ETH appears to be more sensitive to external events,” Forster argued.
Is Bitcoin less vulnerable to macro events?
He also explained that traders seem to be more confident in Bitcoin’s ability to weather these macro conditions. “Perhaps this is because Bitcoin is well-established as a digital store of value and is relatively less directly exposed to regulatory issues than Ethereum.”
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Now, with more concerns about the ecosystem depending on who gets elected president in the U.S., traders are pricing in “more extreme moves” for ETH, according to Forster.
He added, “This data indicates that the heightened volatility in ETH is a direct reflection of traders’ expectations of increased uncertainty, especially as the US elections approach.”
Ethereum is down 5.93% in the last 24 hours. Source: TradingView
At the time of publication, Ether is trading at $2,364, down 5.93% since October 2. Despite the much-anticipated launch of the Ether exchange-traded fund in July, the historic debut failed to boost the price of Ether.
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This article does not contain investment advice or recommendations. All investment and trading activities involve risk and readers should conduct their own research when making any decisions.