In this issue of Coin Metrics’ State of the Network, we examine crypto market dynamics through the lens of options data, exploring trends in open interest and volume, and what they reveal about positioning, volatility expectations and broader shifts in market sentiment.
Key Takeaways:
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Options are increasingly being used to manage risk, express directional views, and gauge market sentiment, making them a powerful lens for understanding crypto market dynamics.
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Open interest in BTC options has surged 5x since 2022, reflecting the rising adoption and liquidity in options markets. Deribit accounts for the vast majority of activity, while BTC-USD, XRP-USDC, ETH-USD, are among the top traded pairs across exchanges.
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Positioning for Deribit’s options contracts in the medium-term (expiring 12/25) shows a bullish tilt in BTC, with open interest concentrated between $90K–$180K. ETH positioning is more dispersed across strike prices, reflecting less consensus on its future direction.
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Short-term implied volatility for both BTC and ETH has recently risen, reflecting growing expectations of near-term price swings.
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