Ethereum bears have the upper hand according to derivatives data, but for how long?

Ether (ETH) terms experienced an 11.9% diminution from Nov. 20 to Nov. 22, bottoming astatine $1,074 — the lowest level seen since July. Currently, investors person crushed to beryllium acrophobic aft crypto lending institution Genesis reportedly faced difficulties raising money, triggering rumors of insolvency connected Nov. 21. 

However, a spokesperson for Genesis told Cointelegraph that determination were nary plans for imminent bankruptcy due to the fact that the institution continues to clasp discussions with its creditors.

Unease astir the centralization of decentralized concern (DeFi) surfaced aft Uniswap Labs changed the privateness policy connected Nov. 17, revealing that it collects publicly-available blockchain data, users' browser information, operating systems information and interactions with its work providers.

Adding to the fracas, the hacker down the FTX speech theft of $447 million has been spotted moving their Ether funds. On Nov. 20, the attacker transferred 50,000 ETH to a abstracted wallet and converted it to Bitcoin utilizing 2 renBTC bridges.

Traders fearfulness that the hacker mightiness beryllium suppressing Ether's terms to nett utilizing leveraged abbreviated bets. The rumor was raised by @kundunsan connected Nov. 15, adjacent though the Twitter station did not summation exposure.

Unpopular opinion:
SBF is the hacker and already shorted marketplace dense and collecting each stolen assets into $ETH
Finally he’ll dump immense ETH container to much nett his abbreviated positions.
He’s inactive rubbing us, unbelievable. https://t.co/CYJmOSgwXO

Let's look astatine Ether derivatives information to recognize if the worsening marketplace conditions person impacted crypto investors' sentiment.

Pro traders person been successful panic mode since Nov. 10

Retail traders usually debar quarterly futures owed to their terms quality from spot markets, but they are nonrecreational traders' preferred instruments due to the fact that they forestall the fluctuation of backing rates that often occurs successful a perpetual futures contract.

Ether 2-month futures annualized premium. Source: Laevitas.ch

The three-month futures annualized premium should commercialized betwixt +4% to +8% successful steadfast markets to screen costs and associated risks. The illustration supra shows that derivatives traders person been bearish since Nov. 10 since the Ether futures premium was negative.

Currently determination is backwardation successful the contracts and this concern is atypical and usually deemed bearish. The metric did not amended aft ETH rallied 5% connected Nov. 22, reflecting nonrecreational traders' unwillingness to adhd leveraged agelong (bull) positions.

Traders should besides analyse Ether's options markets to exclude externalities circumstantial to the futures instrument.

Options traders fearfulness further crashes

The 25% delta skew is simply a telling motion erstwhile marketplace makers and arbitrage desks are overcharging for upside oregon downside protection.

In carnivore markets, options investors springiness higher likelihood for a terms dump, causing the skew indicator to emergence supra 10%. On the different hand, bullish markets thin to thrust the skew indicator beneath -10%, meaning the bearish enactment options are discounted.

Ether 60-day options 25% delta skew: Source: Laevitas.ch

The delta skew has been supra the 10% threshold since Nov. 9, signaling that options traders were little inclined to connection downside protection. The concern worsened implicit the pursuing days arsenic the delta skew indicator surged supra 20%.

The 60-day delta skew presently stands astatine 23%, truthful whales and marketplace makers are pricing higher likelihood of terms dumps for Ether. Consequently, derivatives information shows debased assurance close arsenic Ether struggles to clasp the $1,100 support.

According to the data, Ether bulls should not propulsion successful the towel conscionable yet due to the fact that these metrics thin to beryllium backward-looking. The panic that followed FTX's bankruptcy and the consequent liquidity issues astatine Genesis mightiness dissipate rapidly if exchanges nationalist impervious of reserves and institutional investors addingBitcoin exposure during the dip are interpreted arsenic positives by marketplace participants.

With that said, astatine the infinitesimal Ether bears inactive person the precocious manus according to ETH derivatives metrics.

The views, thoughts and opinions expressed present are the authors’ unsocial and bash not needfully bespeak oregon correspond the views and opinions of Cointelegraph.