As Ethereum’s much-anticipated upgrade — known as the Merge — draws nearer, the cryptocurrency’s trading activity is booming. The second-largest cryptocurrency has overtaken industry leader bitcoin in the options market for the first time in crypto history.

Observers see this as the latest sign that ethereum may soon shoot past bitcoin for the No.1 spot in crypto capitalization.

Ethereum Surpasses Bitcoin In Options Market

Ether’s options arena is seeing massive growth amid rising investor appetite.

According to data from Arcane Research, the open interest on ETH options contracts recently climbed to a whopping $8.1 billion — which is significantly higher than the $5.5 billion locked in open bitcoin options trades.

Open interest is arguably the main gauge for derivative contracts activity. It refers to the number of options contracts traded but not balanced with an offsetting position. Theoretically, OI is computed by multiplying the number of open contracts with the present spot market price of the underlying crypto asset.

The huge gap between Ether and bitcoin is thus connected to the fact that BTC has not registered as much volatility as ETH on the crypto market in recent days. Further, futures premiums and funding rates in bitcoin remain low as trading activity in BTC derivatives decreases, suggesting that traders are not interested in gaining long exposure.

Ethereum’s historic lead over bitcoin in the options market comes as traders bet on either outcome after the Merge is executed. This major software upgrade is expected to significantly reduce the rate at which new ETH is produced and distributed and make the cryptocurrency more appealing as a store of value. The Merge, slated for September 15 or 16, will also make the current Ethereum network, which has been prone to bottleneck congestion and exorbitant transaction fees, faster and more scalable.

That said, in terms of market cap, Ethereum, at $225 billion, is half the size of bitcoin, whose market value stands at $452 billion as of publication time, according to CoinGecko. Some industry pundits are, however, still confident that the ether-bitcoin flippening is nigh.