The crypto market fell to its lowest levels in more than two weeks with bitcoin falls below $67,000 and ether (ETH) closes in at $2,000. The CoinDesk 20 Index (CD20) lost 2.2% since midnight UTC, hitting its lowest since March 9.
The decline coincided with a drop in US stocks. Nasdaq 100 futures are now trading at 23,760, 10% below the year’s high from January.
The risk-off atmosphere was fueled by rising oil prices and fears that the war in Iran would not escalate as quickly as many had hoped. Oil remains above $100 a barrel, raising concerns about inflation.
Parts of the altcoin market were hit harder on Friday, with ETHFI losing 6% since midnight. WLD, WIF, SEI and FET all lost between 3.6% and 4.7%.
Derivatives positioning
- Long bets on crypto futures, or bullish positions on market direction, bore the bulk of liquidations over the past 24 hours, with nearly $300 million liquidated, compared to just $50 million in short positions.
- It is the fifth time in 10 days that longs have approached that level of punishment, an indication that traders were largely positioned for the Iran war to translate into a price rally that has not materialized.
- XRP’s price fell over 2.5% in 24 hours, while open interest in futures is up 2% to 1.95 billion XRP, the most since February 2nd.
- This combination represents renewed investor interest in shorting the declining market. Negative cumulative volume delta and sub-zero fund rates suggest the same.
- Futures linked to bitcoin, solana, dogecoin and BNB showed an XRP-like bearish profile.
- Memecoin SHIB has the largest negative open-interest-adjusted cumulative volume delta among major tokens, signaling aggressive derisking or shorting by traders.
- Canton Network’s CC token stood out with positive funding rates and an increase in futures OI, both signaling increasing demand for bullish exposure.
- Bitcoin and ether’s 30-day implied volatility indices, BVIV and EVIV, continued to decline despite weak spot prices, suggesting that traders are not panicking yet and not expecting a turbulent selloff.
- On Deribit, over $15 billion worth of bitcoin options expired early Friday. So the supposed expiration-related price magnet of $75,000 is no longer valid, opening doors for deeper declines amid a worsening macro outlook.
- Bitcoin and ether puts are again trading at a volatility premium of 6 to 8 for calls across all expirations, risk reversal shows. It indicates sticky demand for downside protection.
Token talk
- The altcoin market again showed its fragility on Friday, failing to hold on to key levels of support in a low-liquidity trading environment.
- The CoinDesk Computing Select Index (CPUS) was the worst-performing benchmark, falling 2.3%, while the bitcoin-dominant CoinDesk 20 (CD20) fell 1.2%.
- One token bucking the bearish trend was ONDO, which rallied after Ondo Finance, an asset management company, said it agreed to tokenize five Franklin Templeton exchange-traded funds (ETFs) and bring them to the Ondo chain.
- The token is up more than 8% in the last 24 hours, though it gave back some of those gains since midnight UTC.
- The average relative strength index (RSI) across all crypto-tokens remains neutral despite the sell-off, suggesting further declines are likely on Friday.
