{"id":36326,"date":"2022-09-21T07:51:15","date_gmt":"2022-09-21T11:51:15","guid":{"rendered":"https:\/\/coinscreed.com\/staging\/?p=36326"},"modified":"2022-09-21T07:51:18","modified_gmt":"2022-09-21T11:51:18","slug":"ether-funding-rates-normalizes-after-merge","status":"publish","type":"post","link":"https:\/\/coinscreed.com\/staging\/ether-funding-rates-normalizes-after-merge\/","title":{"rendered":"Ether Funding Rates Normalizes After Merge"},"content":{"rendered":"\n<h5 class=\"wp-block-heading\" id=\"h-the-ether-funding-rates-for-ether-futures-hit-their-all-time-highs-because-of-a-popular-trade\">The Ether funding rates for <a href=\"https:\/\/www.google.com\/search?q=ether+futures&sourceid=chrome&ie=UTF-8\" target=\"_blank\" rel=\"noreferrer noopener\">ether futures<\/a> hit their all-time highs because of a popular trade.<\/h5>\n\n\n\n<figure class=\"wp-block-image aligncenter size-full\"><img fetchpriority=\"high\" decoding=\"async\" width=\"751\" height=\"560\" src=\"https:\/\/coinscreed.com\/staging\/wp-content\/uploads\/2022\/09\/image-117.png\" alt=\"Ether Funding Rates Normalizes After Merge\" class=\"wp-image-36328\" srcset=\"https:\/\/coinscreed.com\/staging\/wp-content\/uploads\/2022\/09\/image-117.png 751w, https:\/\/coinscreed.com\/staging\/wp-content\/uploads\/2022\/09\/image-117-300x224.png 300w, https:\/\/coinscreed.com\/staging\/wp-content\/uploads\/2022\/09\/image-117-150x112.png 150w\" sizes=\"(max-width: 751px) 100vw, 751px\" \/><figcaption>Ether Funding Rates Normalizes After Merge<\/figcaption><\/figure>\n\n\n\n<p>Nearly a week after the Merge, when traders had to pay high fees to stay in their positions during a popular trade,<a href=\"https:\/\/coinscreed.com\/staging\/coinbase-integrates-polygon-matic-on-its-platform.html\" target=\"_blank\" rel=\"noreferrer noopener\"> funding rates on ether <\/a>(ETH) futures have gone back to normal.<\/p>\n\n\n\n<p>Because of these trades, there were unusually large liquidations on ether futures, and for the first time, weekly trading volumes on spot ether were higher than those on spot bitcoin.<\/p>\n\n\n\n<p>For short positions, which are bets against the price going up, the rates on<a href=\"https:\/\/coinscreed.com\/staging\/binance-set-to-gain-from-increased-supply-of-its-own-stablecoin.html\" target=\"_blank\" rel=\"noreferrer noopener\"> Binance <\/a>and other crypto exchanges are now back to where they were before the Merge, at 0.0045%. Funding rates are payments that traders make on a regular basis based on the price difference between the futures market and the spot market.<\/p>\n\n\n\n<p>As has been reported before, funding rates for ether futures dropped to a yearly low of over 0.30 percent in the first week of September. This means that traders paid 30 cents to exchanges every few hours for a $100 position, which quickly added up when traders holding positions worth millions of dollars kept them for weeks or days.<\/p>\n\n\n\n<p>Analysts from research firm Delphi Digital said in a note on Tuesday that this was a new all-time low for funding rates, beating the previous low of -0.157%, which was set during the March 2020 sell-off.<\/p>\n\n\n\n<p>&#8220;The popular trade was to buy ETH on the<a href=\"https:\/\/coinscreed.com\/staging\/invesco-introduces-its-spot-bitcoin-etn-on-german-stock-market-operator-deutsche-borse.html\" target=\"_blank\" rel=\"noreferrer noopener\"> spot market<\/a> and sell ETH futures. Analysts at Delphi said that traders were buying spot ETH in order to get the ETH-PoW airdrop. After the Merge, traders quickly changed their positions by selling spot ether and unwinding their ether futures positions.<\/p>\n\n\n\n<p>EthereumPOW is the version of the Ethereum blockchain that still uses proof-of-work (PoW) to reach a consensus. The blockchain started as a split from the Ethereum network, which switched to a proof-of-stake (PoS) consensus mechanism last week in an event called the Merge. Now, the PoS network is called Ethereum.<\/p>\n\n\n\n<p>So, the last time the market was at these levels was in June 2021, after which there was a huge short squeeze in July, but this did not happen in September. A short squeeze is a sudden rise in price that forces traders who had sold an asset they had borrowed in order to buy it back at a <a href=\"https:\/\/coinscreed.com\/staging\/bitcoin-is-heading-for-42k-as-stock-market.html\" target=\"_blank\" rel=\"noreferrer noopener\">lower price<\/a> (this is called &#8220;shorting&#8221;) to close their positions. This usually causes prices to rise even more.<\/p>\n\n\n\n<p>At the time of writing, the price of Ether is just over $1,320 and has dropped 2.4% in the last 24 hours.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The Ether funding rates for ether futures hit their all-time highs because of a popular trade. Nearly a week after the Merge, when traders had to pay high fees to stay in their positions during a popular trade, funding rates on ether (ETH) futures have gone back to normal. Because of these trades, there were [&hellip;]<\/p>\n","protected":false},"author":39,"featured_media":36328,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[71],"tags":[128,1859,11292],"class_list":["post-36326","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-markets","tag-ethereum","tag-futures","tag-merge"],"jetpack_featured_media_url":"https:\/\/coinscreed.com\/staging\/wp-content\/uploads\/2022\/09\/image-117.png","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/posts\/36326","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/users\/39"}],"replies":[{"embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/comments?post=36326"}],"version-history":[{"count":0,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/posts\/36326\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/media\/36328"}],"wp:attachment":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/media?parent=36326"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/categories?post=36326"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/tags?post=36326"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}