A new report from CME Group says that tech stocks, the US dollar and Bitcoin (BTC) supply are key drivers that influence the movement of Ethereum (ETH).
According to the derivatives giant, Ethereum gains more than Bitcoin when the prices of technology stocks increase.
The report says that the ETH/BTC exchange rate tends to rise when tech stock prices jump because the rally benefits Ethereum more than Bitcoin.
“Since May 2022, the one-year rolling correlation of ETHBTC with the tech-heavy Nasdaq 100 has been consistently around +0.2 and sometimes as high as +0.3. It has a similar correlation with the S&P 500 Technology Select Sector futures. This suggests a modest but persistent positive correlation between the movements of technology stocks and the movements of ETH relative to BTC.”
Meanwhile, a stronger US dollar gives the opposite effect. A more expensive greenback compared with other currencies produces a more negative outcome on Ethereum than on Bitcoin albeit the tendency is not extremely strong.
“On days when the Bloomberg Dollar Index (BBDXY), which measures the USD versus 10 major currencies, rises, ETHBTC tends to decline.”
The report says BTC and ETH react differently to these macroeconomic factors because of the economics of Ethereum’s unlimited supply and Bitcoin’s cap of 20 million coins.
“ETH and BTC’s differing responses may be grounded in how ETC and BTC are used and the different ways in which they are supplied to the market.”
Don't Miss a Beat – Subscribe to get email alerts delivered directly to your inboxCheck Price Action
Follow us on Twitter, Facebook and Telegram
Surf The Daily Hodl Mix
Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any loses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.
Generated Image: Midjourney
The post Tech Stock Price Jumps Boost Ethereum (ETH) More Than Bitcoin (BTC), According to New CME Group Report appeared first on The Daily Hodl.
