Ethereum

Bitcoin

Ethereum (ETH) is poised for a notable improvement with the impending Dencun upgrade to enhance the network’s scalability. However, amidst this anticipation, QCP Capital, a seasoned crypto asset trading firm, has <a href="https://t.me/QCPbroadcast/1157" target="_blank" rel="noopener nofollow">shed light</a> on an emerging trend that might influence Ethereum’s price trajectory. 
The firm’s analysis reveals a shift in “risk reversals” for Ethereum, turning negative for upcoming expiries. This shift indicates growing concerns among investors about a potential decrease in ETH’s price, as a negative risk reversal often suggests a market leaning towards protective measures against a downturn. 
<h2 id="market-leverage-and-correction-concerns">Market Leverage And Correction Concerns</h2> 
Notably, this trend towards negative risk reversals has been attributed to an increased interest in put options, which serve as a hedge against potential losses for those speculating on price increases. 
Moreover, the broader altcoin market participants are similarly hedging their investments in Ethereum, aiming to mitigate risks associated with their <a href="https://www.newsbtc.com/news/ethereum/ethereum-altcoins-witnessing-whale-interest/" target="_blank" rel="noopener ">altcoin holdings</a>. 
QCP Capital’s insights into the market dynamics also highlight an underlying nervousness about Ethereum’s price stability, especially in light of the <a href="https://www.newsbtc.com/news/ethereum/number-of-ethereum-short-term-holders-increasing-is-a-bull-rally-next/" target="_blank" rel="noopener ">considerable leverage within the market</a>. 
The firm cautions about the potential for a market correction, albeit with an expectation of strong buying interest in the event of any price dips. QCP noted in the report: 
<blockquote>
 Altcoin speculators might also be buying ETH puts as a proxy to hedge altcoin downside. This makes us wary of a possible correction given the amount of leverage in the market. However, we think that the market will buy any dip aggressively.
</blockquote> 
Additionally, Ethereum’s spot-forward spreads have decreased slightly, contrasting with Bitcoin’s sustained high spreads. Commenting on the implication for investors, QCP Capital stated: 
<blockquote>
 A sharp drop in spot price is likely to drag the forward spreads lower as leverage longs get taken out.
</blockquote> 
<h2 id="ethereum-performance-and-outlook">Ethereum Performance And Outlook</h2> 
Despite the cautionary signals, Ethereum continues to perform “robustly” in the crypto market, closely trailing Bitcoin regarding price movements. Currently <a href="https://www.newsbtc.com/analysis/eth/ethereum-price-dips-3830/" target="_blank" rel="noopener ">trading above $4,000</a>, Ethereum has witnessed a modest increase of 0.6% over the past 24 hours. 
<img loading="lazy" decoding="async" class="size-medium" src="https://www.tradingview.com/x/HUKitPcf/" alt="Ethereum (ETH) price chart on TradingView" width="2770" height="1556"> 
Moreover, data from IntoTheBlock (ITB) reveals an encouraging statistic:<a href="https://www.newsbtc.com/news/ethereum/ethereum-wallets-overflow-over-90-addresses-in-profit-ether-to-retest-ath/" target="_blank" rel="noopener "> over 94% of ETH addresses are presently profitable</a>, suggesting a strong holding pattern among investors and a reduced likelihood of selling pressure. This scenario could potentially set the stage for a price uptick. 
However, it’s important to note that Ethereum’s growth trajectory, while positive, has not mirrored the notable surge Bitcoin experienced following the approval of its <a href="https://www.newsbtc.com/breaking-news-ticker/valkyrie-cio-anticipates-xrp-and-ethereum-spot-etfs-following-bitcoins-approval/" target="_blank" rel="noopener ">spot Exchange-Traded Fund</a>, indicating a more measured pace of appreciation for ETH. 
Featured image from Unsplash, Chart from TradingView

Market Alert: Ethereum Faces Potential Downfall As Dencun Upgrade Looms – Here’s Why

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