Eth Price and Oi have reached new heights, will he last?

The main dishes to remember:

• The data on ether derivatives show a low request for bull -in -way leverages.

• Societies and tradfi promote the independent channels of layer 1, which calls into question the domination of Ethereum in decentralized finance.

The ether (ETH) increased to $ 4,518 on Tuesday, while traders showed a higher risk appetite following a modest increase of 0.1% of the inflation of American consumers. However, below the surface, the derivative data suggest that the strength of the rally can be overestimated, especially since certain large companies continue their own layer 1 strategies instead of relying on the ecosystem of layer 2 of Ethereum.

The total interest of the ETH in the long term has reached $ 60.8 billion, compared to $ 47 billion per week earlier. However, the increase results mainly from the assessment of the prices of the ETH, because the interest opened in the Ether terms remains 11% lower than the peak of July 27 of 15.5 million ETH.

ETH derivatives report a low demand for bull -handed positions with leverage

The derivative metrics show a reduced demand for upward exposure with leverage despite solid gains on the market.

The perpetual annualized prime of the ETH is now 11%, considered neutral. Readings greater than 13% indicate an excessive demand for long leverages, observed for the last time on Saturday. This lack of momentum of aggressive merchants is notable given the scale of the recent price rally.

We must assess the term contracts on the monthly ETH to acquire an additional perspective, since perpetual contracts are the preferred instrument of retail merchants. These contracts with a defined expiration date are generally negotiated with an annualized premium of 5% to 10% at cash prices, reflecting the extended settlement period.

After reaching 11% on Monday, the premium fell 8% on Tuesday. Despite a 32% increase in the price of the ETH in the last 10 days, leverages have not returned to the levels observed in the previous bullish cycles, suggesting discomfort on the fundamentals of Ethereum and the trends in onchain’s activity.

X User Techleadhd noted that Stripe, Circle, Tether and JPMorgan launched their own channels rather than adopting Ethereum Layer-2 solutions. Although this view incorrectly assesses Coinbase and Robinhood, which remain anchored at the base layer of Ethereum, it shows that some companies prefer the control of layer 1 and tailor -made infrastructure.

Tokenized assets, including stablecoins supported by traditional reserves, require less decentralization to operate effectively. JPMorgan and Stripe products aim to maintain users in closed ecosystems, not for withdrawal from public networks. For such models, Ethereum Layer-2 integration offers limited incentives.

Low Ethereum onchain activity and layer 1 competition

There is an increasing institutional demand from Eth, reflected in the fundraising negotiated funds on the stock market, but the metrics onchain tell a less optimistic story. The total locked value (TVL) on the Ethereum network has dropped 7% in the last 30 days.

TVL fell to 23.3 million ETH, compared to 25.4 million ETH a month earlier, while weekly base layer costs total $ 7.5 million, a drop of 27% compared to the previous month. More striking, the weekly costs of Ethereum remain below those of the main competitors, with Solana at $ 9.6 million and $ 14.3 million.

In relation: Bitmine targets an enormous increase of $ 24.5 billion while Sharplink increases the ether war chest

Several major players focus on their own layer 1 solutions strengthen concerns about Ethereum’s competitiveness as a decentralized infrastructure for the web3 and financial applications.

In the end, the nominal increase in interest open to the ETH opened is largely based on the price rally of the ETH 51% in the last 30 days, and not an increase in the demand for long leverages.

This article is for general information purposes and is not intended to be and must not be considered as legal or investment advice. The points of view, the thoughts and opinions expressed here are the only of the author and do not reflect or do not necessarily represent the opinions and opinions of Cointellegraph.