Experts from The Kobeissi Letter have identified the reason for Ethereum (ETH) lagging behind Bitcoin, and it is short positions of hedge funds. According to their calculations, the volume of shorts on the asset has grown by 40% over the past few days, and by six times since November.
Never before in history have hedge funds held so many short positions in Ethereum, analysts say, noting two recent spikes in trading volume in the asset.
The first occurred on January 21, the day after US President-elect Donald Trump took office, as traders reacted to potential policy changes. The second surge occurred on February 3, when ETH experienced a sharp sell-off amid a market decline.
In the latter case, Ethereum's capitalization collapsed by 37%, and experts saw this as a repeat of the fall of cryptocurrencies in 2010 in the absence of news.
Despite significant turnover and bursts of activity, Ethereum trading about 45% lower ATH in November 2021. Analysts suggest that the reasons for this were the market manipulation, hedging and bearish forecasts regarding the Ethereum .
