March 8, 2024

Ether, the second-largest cryptocurrency by market value, is approaching the $4,000 mark for the first time since December 2021. It's currently trading at around $3,950. The cryptocurrency has been climbing over the past few months alongside bitcoin, which reached record highs on March 5. Over the past 30 days, ether has outperformed bitcoin, climbing 67%, while bitcoin rallied 57% and the CoinDesk 20 Index, a gauge of the broader crypto market, rallied 53%. According to Kenny Hearn, chief investment officer at SwissOne Capital, ether is rising in sympathy with bitcoin’s recent success and preempting an altcoin rally. “There is nothing stopping ETH hitting the $4,000 level other than psychological resistance,” Hearn said in an interview. “We think it’s a high probability it will happen in the next 24 hours so long as U.S. labor data comes in as expected,” said Hearn. The U.S. is due to publish its February non-farm payrolls report at 13:30 UTC.

If bitcoin were to match gold’s allocation in investor portfolios, its market cap should rise to $3.3 trillion, implying a more than doubling of its price, but that probably won't happen because of the cryptocurrency's risk and heightened volatility, JPMorgan (JPM) said in a research report. Gold is the best comparison for the cryptocurrency given investor perception of bitcoin as a digital version of the metal, the report said. “Most investors take risk and volatility into account when they allocate across asset classes and given the volatility in bitcoin is around 3.7 times the volatility of gold it would be unrealistic to expect bitcoin to match gold within investors’ portfolios in notional amounts,” analysts led by Nikolaos Panigirtzoglou wrote.

Optimism Foundation said on Friday that it entered into a private token sale of approximately 19.5 million OP tokens, worth nearly $90 million at current prices, to an undisclosed buyer. The foundation is one of the maintainers and developers of the Optimism network, a blockchain that runs and settles transactions on Ethereum. The sold tokens are subject to a two-year lockup. However, the buyer can delegate the tokens to unaffiliated third parties for participation in governance decisions, giving the same benefits as an unvested holder.

Animal spirits seem to have returned to the market, spurring a 2021-like interest in bitcoin (BTC) options that would pay off if the cryptocurrency’s price triples in the coming months.

On Friday, the Deribit-listed bitcoin call option at the $200,000 strike price had a notional open interest of over $20 million. The strike price is almost three times bitcoin’s going market rate of $67,000.

Of the total tally, $14.6 million is locked in the call expiring on Dec. 27, while the rest is concentrated in June and September expiries, according to data source Deribit Metrics.

- Omkar Godbole