Prior to the May 19 market crash, crypto traders were looking to double their gains on Ethereum, the world’s second-largest cryptocurrency, on a bet that its 2021 surge could push its price above $8,000 by the end of June.

Since the stock market bottomed in March 2020 over pandemic fears, the price of Ether has surged. The native cryptocurrency on the Ethereum blockchain, Ether saw a price gain of 50 percent in a single week in May. It reached an all-time high of $4,362 on May 12 before falling to less than $1,800 on May 23 as the market collapsed by 60 percent.

Ethereum has since recouped some of its losses, and was trading at $2,784.24 as of this writing on May 26.

Some options traders were betting before the crash that the price could double again by the end of June. Market data showed demand for the digital asset remained bullish with strike prices well above the spot market price.

On May 4, a single high-net-worth trader or a group of traders bought 9,000 contracts of the $8,000 call expiring June 25. This means buyers of the calls are expecting Ether to rise above that level by the end of June.

Cryptocurrency and Ether traders are always using the options market to bet that prices on digital assets such as bitcoin and Ether and will soar – or crater.

Ether fell by as much as 90 percent during the crypto bubble burst of 2017, with some investors wondering if it was dead for good.

The introduction of Ethereum 2.0, or EIP 1559, as a network upgrade in December solved Ether’s long-standing scalability issues and poised it as a better store of value than its bigger rival Bitcoin.

Ethereum is a blockchain just like Bitcoin but it differs in that it is programmable. This means developers can write code, create rules, and make applications on the platform. These “smart contracts” can be used to validate agreements securely.

“Investors look to be betting on continued bullish momentum in anticipation of a big drop in Ether’s issuance after the EIP 1559 upgrade,” according to Laevitas, a Swiss data analytics firm for cryptocurrency markets, Coindesk reported on May 6.

Here’s what some analysts are predicting for Ether since the price plummeted on May 19 according to a May 25 Capital.com report.

• The Ethereum forecast from Digitalcoin remains bullish, predicting the price will average $3,722 in 2021 and rise to $4,650 in 2022. Over the longer term, it projects the price will climb to average $8,047 in 2025 and $11,671 in 2028.
• According to CoinCodex, technical analysis indicators for the Ethereum price were bullish at the time of writing, with 25 indicators giving bullish signals and compared with eight giving bearish signals. At around $2,600, the coin was trading above the three- and five-day simple and exponential moving averages, although it remained below the 10-50 day moving averages. There is short-term support around $2,268, with resistance at $2,828 and above.
• Algorithm-based forecasting service Wallet Investor revised down its Ether forecast from the $3,200 level at the beginning of June to $2,070.95, rising to $2,949.99 at the end of 2021. It predicts the price will move back above $4,000 in 2022, ending the year at $4,512.71, then reaching $9,202.42 by the end of 2025.

Listen to GHOGH with Jamarlin Martin | Episode 74: Jamarlin Martin Jamarlin returns for a new season of the GHOGH podcast to discuss Bitcoin, bubbles, and Biden. He talks about the risk factors for Bitcoin as an investment asset including origin risk, speculative market structure, regulatory, and environment. Are broader financial markets in a massive speculative bubble?

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