coindesk.com
The crypto market traded in a tight range on Friday with bitcoin BTC$89,089.76 changing hands at $88,950 and ether ETH$2,936.25 losing around 1% since midnight UTC to $2,920.
The performance is in line with U.S. equities. Nasdaq 100 index futures and S&P 500 index futures lost 0.4% and 0.25%, respectively, over the same period.
Precious metals gold and silver extended their runs to record highs this week as traders flocked to haven assets, an indication of a risk-off mood in markets.
The sentiment can be attributed to the first trilateral talks between Ukraine, Russia and the U.S. on Friday, with investors seemingly not hopeful that a resolution to the conflict will be made.
The altcoin sector showed signs of slight strength despite wider weakness. LayerZero's ZRO token is up by 12% in the past 24 hours as traders anticipate a major upgrade set in early February, while TRX and DASH both rose by around 3%.
Derivatives positioning
- Over $200 million in crypto futures bets have been liquidated in 24 hours, with longs (bullish plays) accounting for most of the tally. This has been the case since the start of the week as the price drop caught bulls offguard.
- Bitcoin's annualized 30-day implied volatility index, BVIV, has slipped back to 40%, reversing the brief Tuesday pop to 44%. The drop shows a relentless investor interest in selling volatility via strategies such as covered calls.
- Ether is the only top 10 token to have seen a slight increase in futures open interest (OI) in 24 hours. Others, including BTC, ETH, XRP, SOL, saw capital outflows.
- OI-adjusted cumulative volume delta indicator shows net buying in TRX, ZEC and BCH markets. Other markets, including BTC, experienced net selling.
- On Deribit, short- and near-dated ether ETH$2,936.25 put options are pricier than BTC's, a sign traders are more bearish on Ethereum's native token.
- Block flows featured a bias for BTC straddles, a bet on volatility, and ETH put spreads.
Token talk
- The "altcoin season" indicator ticked up to 29/100 from 24/100 over the past week as traders attempted to squeeze gains out of an otherwise tame market.
- The bitcoin-dominated CoinDesk 20 (CD20) Index lost around 0.6% since midnight UTC, while the memecoin, DeFi and metaverse measures are all in the black.
- A lack of liquidity continues to affect the altcoin market, with 2% market depth for an asset like TON$1.5380, for example, sitting at between $580,000 and $700,000. That means it would require an order of between those two figures to move the $3.7 billion market by 2%.
- It's worth noting, however, that if the broader market begins to rally, altcoin gains could be exaggerated as there is a lack of sell orders populating the order book.
- The best performing sector of the year continues to be metaverse tokens, with the CoinDesk Metaverse Select Index (MTVS) posting a 50% gain since Jan. 1, buoyed by strong performance from axie infinity (AXS) and SAND$0.1600.