Dubai, United Arab Emirates, 17 January 2025, Pakinomist
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 a final bird’s-eye view of movements and signals in the derivatives market in the run-up to Trump’s inauguration. Overall, it found its pace in the absence of major news events, with the spot market advancing steadily in the second week of the year.
Data highlighted that realized volatility has caught up with implied volatility after the winter break, indicating a more energized market. Trading volume in perpetual contracts has normalized, although 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 volatility, indicating continued demand for long positions. While BTC and ETH lead the market direction, CRV showed consistent bullish rates, unlike ATOM, which fell 30% from monthly highs.
BTC options reflect long-term optimism: BTC’s realized volatility has recovered to match implied levels after the holiday break. While short-term options are showing increased hedging activity, longer-term contracts maintain a bullish bias with high implied volatility in the 50s, supported by balanced open interest between calls and puts.
Volatility patterns turn bullish after CPI: Recent CPI data triggered a shift in BTC and ETH volatility smiles, with OTM calls showing higher implied volatility than near BTC’s $100K level. This marks a reversal from the previous week’s bearish short-term sentiment, underscoring the market’s 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 and serves 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 strategically collaborates with leading blockchain protocols to deliver robust infrastructure and drive on-chain innovation. Known 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 unleash Web3’s full potential. Discover the future of decentralized economy at Bybit.com.
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