Recent analysis of the cryptocurrency markets reveals a growing optimism among Ethereum traders compared to their Bitcoin counterparts. Ethereum’s 90-day options skew currently stands at -2.8%, which is less bearish when contrasted with Bitcoin’s skew of -4%. This data suggests that traders perceive less immediate downside risk for Ethereum.
Several factors contribute to Ethereum’s relative strength. The recent Fusaka upgrade, significant treasury purchases, and more favorable macroeconomic conditions, particularly in anticipation of Federal Reserve rate cuts, have all played pivotal roles. Yet, despite the improved outlook for Ethereum, experts warn that the market has not yet reached the bullish levels seen at the start of Q4 and that there has been a lack of sustained inflows into exchange-traded funds (ETFs), both of which are critical for any substantial price rally.
Currently, Ethereum is trading just above $3,100, having seen a 2% drop over the past 24 hours. Year-to-date, it has experienced a decline of about 3%, which is slightly better than Bitcoin’s 6% loss. Since October, however, both cryptocurrencies have faced significant downturns, with Ethereum down approximately 19% and Bitcoin seeing a sharper 25% drop.
Looking at longer-dated options, Ethereum’s 90-day skew is recorded at -1.7%, which is “noticeably more bullish” than Bitcoin’s -4%, according to Sean Dawson, head of research at an on-chain options platform. This indicates that traders are more willing to purchase insurance for Bitcoin than for Ethereum, reflecting a general preference for protective put options over bullish calls. However, the severity of the bearish sentiment is where the two diverge.
Recent trends suggest a reduction in bearish sentiment for Ethereum. Research analyst Thahbib Rahman from Block Scholes noted that although bearishness still lingers in the options markets, the situation is beginning to shift. A recent positive turn in the put-call skew for short-dated Ethereum contracts marked the most bullish positioning since late October. Additionally, the BlockScholes Risk-Appetite Index for Ethereum appears to be stabilizing, a pattern that has historically signaled sentiment shifts.
Rahman draws parallels between the current market conditions and those of May 2025, which preceded a notable rally. At that time, improved macroeconomic conditions, the Pectra upgrade, and a surge in Ethereum spot ETF inflows catalyzed a significant price increase. Currently, similar factors are emerging, including the anticipation of a December Fed rate cut and the successful implementation of the Fusaka upgrade, coupled with substantial ETH purchases by entities such as BitMine. However, a critical missing element remains: a sustained influx of funds into Ethereum spot ETFs, necessary for a definitive bullish trend.
While options market data reflects a cautious optimism regarding Ethereum’s potential downturn, retail prediction markets have a more bullish outlook. Users on Myriad assign Bitcoin a 75% chance of reaching $100,000 before surpassing the $69,000 mark, while Ethereum is given only a 49% chance of hitting $4,000 before dropping to $2,500. This shows a divergence in sentiment between professional investors and retail traders, highlighting the complexity of the current market landscape.
