Bitcoin Underperformance relative to gold, to which it is often compared, persists as its dollar price lacks a clear directional bias, trading between $86,000 and $90,000. It is currently up 1.2% since midnight UTC against the greenback.
The bitcoin-to-gold price ratio, however, fell to 20.18, the lowest since January 1, 2024, according to data source TradingView. This sustained decline shows that investors still favor the precious metal as their preferred safe haven, amid what some see as fiscal imprudence in the advanced world and talk of interest rate cuts from the Federal Reserve.
The ratio could improve later on Thursday if U.S. inflation data comes in below expectations. This could increase expectations for rate cuts and stimulate risk-taking in financial markets.
Positioning of derivative products
- The downward trend in BTC’s 30-day implied volatility, as represented by Volmex’s BVIV Index, has stopped at around 50%. However, there are no signs of a further recovery, meaning traders do not expect volatility to pick up at this time.
- The MOVE index, the equivalent of US Treasuries, fell to 62.73, its lowest level since October. A decline in Treasury market volatility generally bodes well for risky assets.
- Among major tokens, SOL TRX and DOGE saw an increase in open interest (OI) in the futures market.
- Funding rates for BNB, XRP, SOL, TRX and DOGE have turned negative. The combination of an increase in OI and negative rates in DOGE and TRX indicates an accumulation of short positions.
- On Deribit, risk reversals continue to show a bias for BTC and ETH puts, indicating lingering bearish fears.
- Block flows featured call calendar spreads and strangles in BTC and spreads and strangles put in ETH.
Symbolic discussion
- Yearn Finance, one of DeFi’s first and most recognizable yield aggregators, suffered another exploit this week, with attackers removing around $300,000 from an old smart contract.
- The vulnerability resided in a contract linked to iEarn, an early version of the protocol dating back almost six years. Security firm PeckShield reported the exploit, noting that the attacker exchanged the stolen funds for 103 ETH, worth approximately $290,000.
- Yearn responded shortly after, clarifying that the attack had no impact on vaults or current contracts. “The issue is exclusive to iEarn and has no impact on current Yearn contracts or chests,” the team posted on X.
- This is the second exploit that Yearn has suffered in the past month. Earlier in December, attackers stole $9 million using a separate vulnerability.
- Yearn’s YFI token fell almost 6% after the exploit and is underperforming the market as a whole. The total value locked on the yield aggregator has plunged more than $50 million to $560 million since the first exploit, data shows.
