The crypto market remained sluggish and weak on Wednesday like bitcoin and ether (ETH) was down less than 0.4% since midnight UTC, and the CoinDesk 20 Index (CD20) lost 0.9%, with 18 of its constituents falling.
The lack of a meaningful return will be the main concern, especially as US stock futures began to recover from Tuesday’s tech sell-off.
Part of the altcoin market outperformed its peers, with jupiter (JUP) and monero (XMR) posting gains of between 2% and 4%, suggesting that investor appetite is still alive despite bearish market conditions.
Bitcoin must now avoid slipping back below the psychological support level of $60,000, which would trigger a return to a trading range not seen since late 2024, with $52,000 emerging as a key level to the downside.
Derivatives positioning
- Trading has slowed in the derivatives market, with volume down 27% to $141 billion over the past 24 hours, while open interest is up 2% to $106 billion. Liquidations totaled $158 million, the lowest in two weeks.
- BTC futures open interest (OI) is holding steady at around 730K BTC for the eighth day in a row, signaling consolidation at current levels.
- ETH futures show renewed action. OI rose to 14.3 million ETH, a two-week high and up from a recent low of 13.74 million.
- The increase came as the spot price fell from around $1,780 to $1,650 over the past two days, a combination that typically indicates traders are shorting into the rally. While funding rates are holding slightly positive, showing some demand for bull exposure, the 24-hour cumulative volume delta (CVD) is negative, a sign that bears are leading price action through market orders rather than passive limit orders.
- SOL futures are busier than ever, with lifetime OI at 77.68 million tokens. However, both funding rates and 24-hour OI-adjusted CVD are negative, meaning the action is being driven by fresh shorts or bearish bets on the token.
- In contrast, ZEC’s market is cooling rapidly, with OI retreating to 2 million tokens from nearly 2.55 million tokens last month.
- Broadly, bears appear to be leading price movements in most of the top 25 tokens, as evidenced by negative OI-adjusted CVDs for the second day in a row.
- Bitcoin’s 30-day implied volatility index (BVIV) has cooled to 43% from nearly 48% on Tuesday. Ether’s volatility index shows a similar pattern.
- On Deribit, the one-week bias was extended to 10.9 vol-points in favor of puts from approx. 7 points a day ago, a clear sign of growing downside concerns. The one-month bias also widened.
- Block flows on Paradigm featured a straddle strategy involving call and put options at the $62,000 strike, both expiring on July 3. A straddle buyer bets on increased volatility.
Token talk
- While monero and jupiter fared well as Wednesday dawned, the same cannot be said for ethena (ENA), pump (PUMP) and stellar (XLM), which all fell between 2.2% and 3.5% since midnight UTC.
- Athena has now lost more than 90% of its value since hitting a record high of $0.87 last September. The return-generating DeFi platform suffers from a strategy that depends on bullish market conditions, including positive funding rates.
- Similar draws have been seen across veteran tokens such as and which failed to reach their respective 2021 highs in the recent bull market, effectively trading in a macro downtrend since then.
- The US Dollar Index (DXY) continued to make new ground on Wednesday and is now challenging its May 2025 high. A strengthening dollar is typically seen as a negative for risk assets, including altcoins, because it suggests investors are feeling more secure in cash.
