The crypto market is in a good mood after bitcoin surpassed $80,000 during the Asian morning on Tuesday.
BTC is currently trading at $80,690, having increased by over 1% since midnight UTC. Ether (ETH), meanwhile, sits at $2,370 after failing to surpass April’s high of $2,460.
U.S. stocks are higher in premarket trading, with Nasdaq 100 and S&P 500 futures rising 0.5% and 0.3%, respectively, on Tuesday, boosted by investors buying the dip after Monday’s jitters over the Strait of Hormuz.
Precious metals, gold and silver, also rose on Tuesday, but remained significantly lower than the speculative explosion at the beginning of March.
Positioning of derivative products
- Cardano’s ADA-linked futures contracts are seeing record participation. Open interest (OI), the total number of active futures contracts, surged more than 18% to 2.17 billion tokens, surpassing the previous high in January.
- Despite this accumulation, the positioning in ADA does not seem excessively overheated. Perpetual funding rates stand at 9% annualized, indicating bullish sentiment but not extreme leverage. Meanwhile, ADA posted one of the highest cumulative volume deltas (CVD) over the past 24 hours among major tokens. This means that buyers stimulate trading activity by placing more market orders than sellers, rather than using passive limit orders.
- TON is another remarkable product. Open interest jumped 40% to a record 200.2 million tokens. It also shows the strongest CVD among the top 30 cryptocurrencies, indicating aggressive buying pressure. However, financing rates remain slightly negative, an unusual combination. This suggests more nuanced positioning: traders can buy TON in the spot market while simultaneously selling futures contracts to hedge, rather than purely speculative long positioning.
- There is a broader signal of caution. Despite bitcoin’s breakout above $80,000, the OI-adjusted 24-hour CVD is negative for bitcoin and most major tokens, with the exception of ADA, TON, and M. This indicates that the rally is not strongly supported by aggressive derivatives buying, increasing the risk that price increases will fail to follow through if spot demand weakens.
- Looking closer at Bitcoin, its open interest increased by around 3% to 785,000 BTC, closing in on the recent all-time high near 800,000 BTC. In contrast, derivatives activity on ether,
- Volatility is also starting to stir. Bitcoin’s 30-day implied volatility index (BVIV) jumped 5% on Monday to return above 40%, the largest one-day increase since mid-March. This rebound after several months of lows deserves to be monitored closely. A continued increase in implied volatility may signal increasing demand for hedging or expectations of larger price swings and, in some cases, may coincide with risk aversion and a liquidation of recent gains. However, the ether equivalent measurement (EVIV) has yet to show a similar recovery.
- In traditional markets, early signs of demand for hedging are also emerging. Social media chatter is reporting heavy buying of call options on the VIX – Wall Street’s “fear gauge,” which typically moves inversely to the S&P 500.
- Options markets on Deribit show that risk reversals for bitcoin and ether remain biased toward puts across all time frames. This means that downside protection is always valued at a premium relative to upside exposure. Rather than an outright decline, this likely reflects a change in market structure: institutions play a larger role and tend to systematically hedge downside risk or generate yield by selling call options. The result is a less euphoric, more hedged market than in previous crypto cycles.
Symbolic discussion
- CoinDesk’s DeFi Select Index (DFX) is the best performing benchmark on Tuesday, up 2.7% since midnight UTC after Ethena (ENA) and ONDO jumped 6.8% and 3.7% respectively.
- CoinDesk 5 (CD5) is the worst performer, recording a 0.5% gain as investors appear to shift towards more speculative bets as opposed to the crypto majors.
- CoinMarketCap’s altcoin season indicator is at 41/100, showing neutral but warming sentiment towards the sector after a multi-month downtrend.
- Toncoin (TON) is the best-performing altcoin among the CoinDesk 100 (CD100), rising 8.1% since midnight UTC and 28% over the past 24 hours following an announcement from Telegram CEO Pavel Durov who said Telegram would replace the Ton Foundation as the network’s driving force.
