Even as Ethereum's (ETH) price sank below $2,000 this week for the first time since late March, the derivatives market was getting busier and not in the direction most people expected. Ether
Even as Ethereum's (ETH) price sank below $2,000 this week for the first time since late March, the derivatives market was getting busier and not in the direction most people expected.
Ether futures open interest climbed to a record 16.39 million ETH, equivalent to roughly $32.5 billion, on May 28, according to CoinGlass. That combination is a warning sign. Open interest building while price drops is a reflection of fresh short positions entering the market, bets that ether falls further, not recoveries.
The funding rate, the fee perpetual traders pay to hold a position, stayed flat at 0.0022%, per Coinglass. Nobody is paying a premium to be long.
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The derivatives data did not stop the crowd from piling in. According to Santiment's ETH sentiment tracker, the ratio of bullish to bearish commentary toward the token hit a month-high of 2.4 to 1.0 on May 28, a reading that sits firmly above the analytics firm's FOMO zone threshold, where the crowd turns greedy.
Santiment's read on that enthusiasm was blunt.
"There will be an opportunity to buy Ethereum, but ideally you will want to wait for the majority to cool down their FOMO and begin to show panic,"the firm wrote in an X post.
"This way, you will be buying while there is true blood in the streets."
The crowd rushing to buy a breakdown at a key psychological level is, historically, the kind of optimism that shows up before more pain, not less.
However, one institution is not flinching.
Standard Chartered's digital assets research head Geoffrey Kendrick wrote a note on May 28 to reaffirm a forecast he has held since February. Ether at $4,000 by year-end and $40,000 by the end of 2030, he said.
Kendrick's argument is that the Ethereum network and its token have come apart. Transaction counts and value locked in its applications are near record highs, yet ether has fallen 57% from its August peak against the dollar and shed 37% against Bitcoin.
He compared the divergence to Jeff Bezos watching Amazon's stock crater from $113 to $6 during the 2001 dot-com collapse while the business underneath kept building. Those shares have climbed roughly 1,000-fold since.
"I view ETH’s performance very much as Jeff Bezos described AMZN share price during the 2001 tech bubble burst,” Kendrick wrote, adding "ETH will catch up to the internal metrics, it is just a matter of time."
Standard Chartered has long projected stablecoins reaching $2 trillion and tokenized real-world assets hitting $2 trillion by end-2028, with Ethereum expected to carry the vast majority of both markets.
Related: Standard Chartered warns of $500 billion threat to banks
