Ethereum futures open interest hits new all-time high of over $20 billion, signalling bullish momentum: CryptoQuant

Ethereum’s derivatives market may be signaling bullish momentum as futures open interest surged over 12% to an all-time high of $20.8 billion on Friday. This follows a 7% price increase over the past 24 hours that pushed Ethereum to $3,365, according to The Block’s price page .

Open interest, which measures the total number of outstanding contracts in a derivatives market, has reached unprecedented levels for Ethereum. Analysts attribute this surge to heightened bullish sentiment among derivatives traders.

According to a CryptoQuant report, the Ethereum OI-weighted futures funding rate has spiked numerous times over the past week to hit new all-time positive highs, signaling a prevailing dominance of long-position traders. It is currently at 0.0374%, according to Coinglass data . "This suggests a market sentiment favoring upward price movements in the short term," the CryptoQuant report added.

Ethereum futures open interest across all exchanges has hit a new all-time high. Image: CryptoQuant.

Increasing Ethereum derivatives activity and leverage

Ethereum’s futures market has seen substantial growth in recent months. According to CryptoQuant data, Ethereum’s open interest has grown over 40% in the last four months, crossing the $20 billion mark and surpassing its previous high of over $17 billion in May.

“Ethereum’s derivatives market activity reflects growing investor engagement, with futures open interest recently crossing $20 billion for the first time,” said a CryptoQuant analyst.

Funding rates are currently positive, signaling a market skewed toward long positions, or bets on rising prices. Additionally, Ethereum’s estimated leverage ratio—a measure of the open interest divided by exchange reserves—has climbed to a new record of 0.40. This suggests increased risk-taking among traders, as they use higher leverage to amplify potential returns.

However, the CryptoQuant report warned that elevated leverage and the dominance of long positions could increase the risk of a long squeeze. "Sudden price volatility could trigger liquidations, leading to market corrections," the CryptoQuant report added.

Ethereum network activity increases in November

Beyond derivatives, Ethereum’s on-chain trading volume has also experienced a significant uptick in November. After a sluggish year characterized by risk-off sentiment, on-chain trading volume has jumped 85% in just two weeks, rising from $3.84 billion on Nov. 1 to $7.13 billion on Nov. 15.

This resurgence in activity could be driven by several factors, including large inflows of Ethereum exchange-traded funds and renewed market confidence following Donald Trump’s U.S. presidential election victory.

Trump's win on Nov. 5 has encouraged cryptocurrency investors, who anticipate a new regime that is more friendly to the industry. Bitcoin’s recent rally to a new all-time high of over $99,000 this week has acted as a key catalyst for altcoin price appreciation, with Cardano up 46% and Solana increasing by 22% in the past week.

According to BRN analyst Valentin Fournier, institutional investors are driving much of bitcoin’s recent momentum, with retail participation also growing steadily.

"With strong catalysts intact, bitcoin is on track to reach $120,000 by year-end,” Fournier said in an email to The Block. However, he cautioned that surpassing the $100,000 milestone could lead to heightened volatility and potential liquidation of leveraged positions.