Ethereum season? ETH options traders are placing big bets for June
The price of Ether (ETH) is continuing to rally, reaching $2,000 on Friday on the back of strong technical momentum following a high-profile announcement from Visa.
As Cointelegraph previously reported on Sunday, Visa will allow its partners to use USD Coin (USDC) on the Ethereum blockchain network to settle transactions.
Since then, the interest in Ethereum across both futures and options markets is seeing an uptick, with the former approaching $7 billion, the highest in over a month.According to Cantering Clark, a cryptocurrency trader and analyst, the Ethereum options market shows big bets heading into June.The strike price with the highest open interest is $3,200. Although this does not necessarily mean that there is a high probability of ETH hitting $3,200, it indicates that there is significant interest at that price level.
While there could be multiple reasons why traders might be anticipating ETH to have surpassed $3,000 by June, one of the biggest factors is the much-anticipated EIP-1559 upgrade.
EIP-1559 is set to go live in July 2021, which would overhaul the existing fee structure of the Ethereum blockchain.
Simply put, the proposal burns fees that are paid in ETH rather than paying miners, which proponents say should stabilize fees for transacting on the Ethereum blockchain. As Cointelegraph reported, the cost of using the blockchain rose 77% over the past few days in line with a 31% increase in the price of Ether.
EIP-1559 essentially burns some of the ETH paid for transacting, which should reduce the circulating supply of ETH and hence put upward pressure on its value.
Since a lot of options targeting the June strike price would expire right before the EIP-1559 implementation, it means traders are expecting a rally going into the implementation phase.
