LMAX Digital volume got off to a quiet start this week, though the price action was completely expected given a holiday thin Monday. Total notional volume for Monday came in at $585 million, 22% below 30-day average volume.

Bitcoin volume printed $337 million on Monday, 10% below 30-day average volume. Ether volume came in at $186 million, 28% below 30-day average volume.

Looking at average position size over the past 30 days, we’re seeing average bitcoin position size at $8,043 and average position size for ether at 6,714.

Volatility has been trending lower as we come into 2022. We’re now looking at average daily ranges in bitcoin and ether of $2,200 and $198 respectively.

We’re into a new year and we thought it might be a good idea to take some time to offer a quick snapshot overview of overall performance for bitcoin and ether in 2021. Though we did see some selling pressure into the end of 2021, it was another good year of performance.

In 2021, the star performer of the two was ether in a big way. Ether was up some 265% in 2021 against the US Dollar, while bitcoin was up a more modest 40% against the Buck. We would attribute ether’s outperformance to the boom in decentralised finance and mainstream adoption by way of NFTs.

As we look ahead to the year of 2022, our overall outlook remains constructive. However, we are concerned about headwinds from the macro front that might prevent ether from outperforming bitcoin. Ether is indeed the more risk correlated cryptocurrency and with higher US interest rates in the pipeline and COVID fallout still not properly assessed, we could see ether underperform bitcoin as a consequence.

We also believe ether will have a tougher path forward given all of the competition around it. With bitcoin, we don’t really see any competition. But as far as Ethereum goes, there are many other blockchains on the rise that are trying to take away market share. These include, Solana, Polkadot, and Tezos.

Of course, regulation is also another concern for the space in 2022. There are still many questions unanswered here and market participants will be looking for clarity. We worry this clarity could once again prove more disruptive to the Ethereum blockchain, and this is yet another risk that must be considered.

So on net, while we still see room for both ether and bitcoin to make additional gains against the US Dollar in 2022, we also see a place where bitcoin is in position to outperform ether over the next 12 months.