Ethereum futures optimism at monthly low — Is $2.8K a buy zone?

Ether (ETH) suffered a significant hit on Feb. 3 and has since struggled to maintain levels above $2,800. Ether is down 24.5% over the past 30 days, while the broader cryptocurrency market capitalization has fallen by 10% during the same period. This performance has disappointed investors, prompting some to question whether ETH has sufficient momentum to return to bullish territory.

ETH futures markets now show the lowest level of optimism among professional traders in over a month. This development has raised concerns about whether Ether can recover to $3,400 anytime soon.

A higher long-to-short ratio typically signals a preference for long (buy) positions, while a lower ratio indicates that traders favor short (sell) contracts. Currently, top ETH traders on Binance report a long-to-short ratio of 3.3x, well below the previous two-week average of 4.4x. At OKX, the ratio is 1.2x compared to a two-week average of 2.2x.

Some of Ether’s recent underperformance can be attributed to increased competition. However, Ethereum’s monetary policy and ongoing disputes over scalability have also contributed. 

Over the past 30 days, Ether’s supply increased at an annualized rate of 0.5%, according to the “ultrasound money” website. This trend reflects low demand for blockchain space and has been driven by the adoption of layer-2 scaling solutions.

The Ethereum Foundation has faced strong criticism for its limited involvement in several key ecosystem projects. Some long-time developers have publicly expressed their discontent, prompting Ethereum co-founder Vitalik Buterin to assert sole authority over the Ethereum Foundation on Jan. 21.

On a positive note, inflows into spot Ether exchange-traded funds (ETFs) and recent ETH purchases by World Liberty Financial—a project closely linked to US President Donald Trump—suggest that buyers remain interested. Since Jan. 30, US spot Ether ETFs have seen net inflows of $487 million, a complete reversal from four previous trading sessions that experienced net outflows of $147 million.

On Jan. 31, World Liberty Financial—a tokenized digital asset project backed by the Trump family—acquired an additional $10 million in Ether, according to data from Arkham Intelligence. The firm’s holdings reached 66,239 ETH, valued at $182 million as of Feb. 5, marking its largest position ahead of Wrapped Bitcoin (WBTC) and other altcoins.

Ether derivatives premium dropped to 7% after drop in leverage demand

To determine whether whales and market makers have turned bearish on Ether, analysts should examine ETF monthly futures markets. These contracts typically trade at a 5% to 10% premium relative to spot markets to account for the longer settlement period.

The Ether derivatives market reinforces this sentiment, with the premium falling to 7% from 10% on Feb. 2. Although still within the neutral range, there is less demand for leveraged long positions among professional traders. More notably, the ETH futures premium remained above the 5% threshold for bearish markets even during the crash on Feb. 3.

Related: ‘Altseason’ ended in 2024: Bitcoin dominance should hit 71% before it returns

There is no clear evidence from ETH derivatives markets that whales have turned bearish or abandoned hopes for further bullish momentum. Meanwhile, increased competition from Solana and Hyperliquid has led investors to reassess Ether’s upside potential. Investors also appear hesitant to add bullish positions ahead of the upcoming ‘Pectra’ upgrade, given that its immediate benefits for the average user remain uncertain.

Ultimately, the current $2,800 price seems to offer a reasonable entry point, considering Ethereum’s leadership in total value locked (TVL) and growing institutional demand. Whether the $3,400 level can be reclaimed depends on clearer benefits for ETH stakers and long-term investors.

This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.