Dubai, United Arab Emirates, January 17th, 2025, Chainwire
Bybit, the world’s second-largest cryptocurrency exchange by trading volume released the latest weekly crypto derivatives report in collaboration with Block Scholes. The report provides one last bird’s eye view of movements and signals in the derivatives market in the run-up to Trump’s inauguration. The overall found its pace in the absence of major news events, with the spot market treading steadily in the second week of the year.
Data highlighted that realized volatility has caught up with implied volatility following the winter break lull, indicating a more energized market. Trading volumes in perpetual contracts have normalized, though participants appear to be awaiting clearer crypto-specific catalysts for more decisive positioning.
Key Insights:
Funding Rates Signal Long Position Strength: Perpetual swap funding rates maintained positive territory despite spot price fluctuations, indicating sustained demand for long positions. While BTC and ETH lead market direction, CRV showed consistently bullish rates, contrasting with ATOM which dropped 30% from monthly highs.
BTC Options Reflect Long-Term Optimism: BTC's realized volatility has recovered to match implied levels after the holiday lull. While short-term options show increased hedging activity, longer-dated contracts maintain a bullish skew with high implied volatility in the 50s range, supported by balanced open interest between calls and puts.
Volatility Patterns Turn Bullish Post-CPI: Recent CPI data triggered a shift in BTC and ETH volatility smiles, with OTM calls showing higher implied volatility than puts near BTC's $100K level. This marks a reversal from the previous week's bearish short-term sentiment, highlighting market sensitivity to macro factors.
Sources: Bybit, Block Scholes
The full report, including a detailed analysis of volatility trends, funding rates, and options market dynamics, is available for download.
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About Bybit
Bybit is the world’s second-largest cryptocurrency exchange by trading volume, serving a global community of over 60 million users. Founded in 2018, Bybit is redefining openness in the decentralized world by creating a simpler, open and equal ecosystem for everyone. With a strong focus on Web3, Bybit partners strategically with leading blockchain protocols to provide robust infrastructure and drive on-chain innovation. Renowned for its secure custody, diverse marketplaces, intuitive user experience, and advanced blockchain tools, Bybit bridges the gap between TradFi and DeFi, empowering builders, creators, and enthusiasts to unlock the full potential of Web3. Discover the future of decentralized finance at Bybit.com.
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